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⚫ ︎ What is FOMC?

FOMC stands for “Federal Open Market Committee,” and is called “Federal Open Market Committee” in Japanese. It is part of the Federal Reserve System (Federal Reserve System), which is America's central bank, and plays a very important role in determining American monetary policy.

⚫ ︎ FOMC configuration

The FOMC is made up of 7 members of the Federal Reserve Board and 5 of the 12 Federal Reserve Bank presidents. These members are economic experts, monitor the American economy as a whole, and decide on monetary policy.

⚫ ︎ Purpose of FOMC

FOMC has the following three main objectives

1. Controlling inflation: Preventing a sharp rise in prices.
2. Decrease in unemployment: Reducing the number of people without jobs.
3. Promoting economic growth: making a country's economy grow.

⚫ ︎ FOMC activities

The FOMC meets 8 times a year to determine policy interest rates (federal funds interest rates). This interest rate is the interest rate when banks lend and borrow from each other, and it has a major impact on the economy as a whole. For example, if interest rates are raised, debt will increase, consumption will decrease, and inflation will be suppressed. Meanwhile, lowering interest rates makes debt cheaper, companies invest more, and unemployment falls.

⚫ ︎ What is a dot plot?

The dot plot is a diagram of FOMC members showing future policy interest rate prospects. It is announced once every 3 months, and each member's predictions are shown in points. This makes it easier for the market to predict the future direction of monetary policy.

⚫ ︎ The impact of the FOMC decision on the economy

FOMC decisions have a huge impact not only within America, but on financial markets around the world. For example, if America raises interest rates, interest rates and exchange rates in other countries will also be affected. Therefore, FOMC meetings and decisions have attracted worldwide attention.

⚫ ︎ Disclosure of meeting minutes

Minutes will be made public 3 weeks after the FOMC meeting. In these minutes, it is recorded what kind of judgment the decision was made under, and it is an important document for predicting future monetary policy.

⚫ ︎ summary

The FOMC is an important committee that determines America's monetary policy, and its decisions have a profound impact on the domestic and international economy. By adjusting policy interest rates and announcing dot plots, we aim to suppress inflation, reduce the unemployment rate, and grow the economy, and these trends are constantly attracting attention.
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