What is the Fed and why is it important to the global economy

What is FED

Many countries have their own central banks, and the Fed is the Federal Reserve Bank of the United States. The United States holds the world’s most impactful currency, the U.S. dollar. And as we all know; gold is an inflation hedge as well as a guarantee for the currency of various countries. But there is also an asset that many countries trust, which is the US dollar spread across all countries. Therefore, the FED, or Federal Reserve policy, is like setting the direction of the assets in the hands of each country as well.


If asked why, the US dollar must have a global impact

As we all know, it is the United States that has been influential for a long time. By comparison, during World War II, no one was able to step into US territory. It is a country that lends and buys goods from countries affected by world wars in Europe and Asia. It is also a land that contains approximately two-thirds of the world’s gold, and during World War II, the United States began to discuss how to make a currency exchange system by finding the world’s central currency. And the result is the US currency. and have more economic power in the world as well.

What is FED?

         The Fed is the central bank of the United States through the Federal Reserve System. It is responsible for organizing the efficient operation of the United States’ economy. This includes maximizing employment; stabilizing the financial system; regulating and overseeing the stability of financial institutions; and managing the efficiency of the US payment system through monetary policy like any other central bank in the world. These include setting the policy interest rate; adding liquidity to the economy; maintaining the exchange rate; and issuing financial aid measures. The FOMC, which stands for Federal Open Market Committee, or the Monetary Policy Committee in Thailand, is the committee that decides the FED’s policies or measures. 

Thus, the FED is like the dictator of the US dollar, the most powerful currency in the world, no matter what the Fed does or does not do. It will always have an impact on the global economy. For example, when the baht depreciates and the US currency appreciates, it will benefit exports. And one of the things that we have always had a positive impact on is tourism. If we want to go on a trip abroad, currency exchange is important. If we can exchange a lot more than usual, it will be another factor that affects the decision to choose to travel to that country as well.

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