The Board of Governors of the Federal Reserve System
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The Federal Reserve Board (FRB), also referred to as the Federal Reserve System’s Board of Governors, is the main governing body of the Federal Reserve System. The FRB is in charge of overseeing the implementation of monetary policy in the United States and overseeing the Federal Reserve Banks. The current chair of the FRB is Jerome H. Powell. There are currently six members on the board, with one vacant seat; thus, there are typically seven FRB members.
The members of the FRB also serve on the Federal Open Markets Committee (FOMC). Being the main governing body of the Federal Reserve System and being directly accountable to Congress, the FRB is essentially the main influence on the operations of the Federal Reserve System.
The FRB governors are appointed for staggered 14-year terms; the appointment is done by the U.S. President and is confirmed by the U.S. Senate. By statute, once a member serves a full 14-year term, they are not eligible for reappointment. It is important to note that the FRB is to act independently of the current administration.
The Federal Reserve Board and Federal Reserve System
The Federal Reserve serves as the central bank of the United States; the FRB is the main governing body for the Federal Reserve System. Through the FRB and the Federal Reserve System, the monetary policy decisions for the United States are decided upon. Additionally, the Federal Reserve System performs five general functions:
To promote stable prices, moderate long-term interest rates, and maximum employment in the United States through monetary policy decisions.
To minimize systematic risks and encourage stability of the financial system, which is achieved by monitoring and engaging abroad and in the United States.
To monitor the impact of individual financial institutions on the financial system and to promote the soundness and safety of said institutions.
To ensure the safety of the payment and settlement system, which facilitates U.S. dollar-denominated transactions operate efficiently through the banking system and the U.S. government.
To promote the protection of consumers and development of communities, which is achieved through research, examination, and supervision of consumer trends, issues, laws, regulations, and developments.
The Federal Reserve Board and Three Key System Entities
The Federal Reserve Board, Federal Open Markets Committee (FOMC), and the Federal Reserve Banks work together to promote the health of the U.S. economy, ensure the stability of the U.S. financial system and guarantee the soundness of financial institutions. The three key system entities are part of the Federal Reserve System, which was established under the Federal Reserve Act of 1913.
The Federal Reserve Board is the issuing authority for the world’s most important currency, the U.S. dollar. The FRB is tasked with oversight of the supply of the U.S. dollar, helping maintain confidence in the currency. As a part of the FRB’s oversight of the U.S. dollar, they collaborate with the Bureau of Engraving and Printing, and the U.S. Secret Service to monitor counterfeiting threats.
Federal Reserve Banks
There are twelve federal reserve banks in the United States; they are located in Atlanta, Boston, Cleveland, Chicago, Dallas, Kansas City, New York, Minneapolis, Philadelphia, San Francisco, St. Louis, and Richmond. The banks focus on their respective geographical regions and act in coordination with the Federal Reserve Bank of New York.
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