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What Is Federal Reserve?

Definition and plain-English explanation of "Federal Reserve"

Federal Reserve — Basics illustration

The Federal Reserve (the 'Fed') is the central bank of the United States. It manages monetary policy, sets benchmark interest rates, and aims to keep inflation low and employment high. Fed decisions on rates and money supply are among the most market-moving events investors watch, influencing everything from mortgages to stock valuations.

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Market Navigator Glossary — plain-English definitions of 93+ investing and crypto terms. All content is for educational purposes only and does not constitute financial advice.