GB 570 Global Monetary Policy Federal Reserve Discussion

Monetary PolicyThe Federal Reserve is responsible for regulating the U.S. monetary system and setting monetary policy. Monetary policy refers to what the Federal Reserve does to influence the amount of money and credit in the U.S. economy. Policy instruments that affect quantity of money and credit affect interest rates (the cost of credit) and the performance of the U.S. economy.The Federal Reserve’s three instruments of monetary policy are open market operations, the discount rate and reserve requirements. The Fed controls the money supply primarily through open-market operations.Board of Governors of the Federal Reserve System. (n.d.). Retrieved from Based on the above summary and the detailed descriptions of the monetary policy issues in the textbook (Chapter 34) discuss the following questions.