In the financial industry, it is set by the Federal Reserve and all banks are required to abide by them as well as keeping them all in unison. This helps regulate the practices of all banking and lending institution. Regulations can be defined as rules, procedure and laws set by government agencies in order to achieve its objectives. The main role of keeping money controls is that it secures singular buyers against managing an account and loaning rehearses that are misleading and can possibly hurt or disregard singular protection rights. The Federal Reserve is relevant for Congress not only because the Constitution gives monetary powers to congress but also because congress created the Fed and, therefore, has critically important responsibilities for Federal Reserve oversight. The Federal Reserve which sometimes can be referred to Central Bank is one of the country’s most powerful economic institutions. The important of the Federal Reserve cannot be overemphasized. The Federal Reserve and monetary policy is very important in the financial markets because it influences interest rates and stabilizes the financial system. The functions are important because the Federal …show more content…
Decision regarding the cost and availability of credit are another function of the Federal Reserve which helps in promoting high employment, economic growth and price stability in the nation. In times of financial crises, the Fed stabilizes the entire financial system. The Federal Reserve, being the ultimate supplier of system-wide reserves, can satisfy sharp increase in reserve or liquidity demand, thereby stabilizing the financial system. The Federal Reserve function also influences foreign exchange rates and other market