Federal Reserve Bank Of New York Essay, Research Paper

assets. When U.S. rates are declining (as they are currently) relative to those overseas, investment

flows toward other

countries and other currencies.

Implementation

Upon analyzing the aforementioned economic data, the Fed proceeds to set the monetary policy

targets for the economy. The FOMC issues a directive to the Federal Reserve Bank of New York

stating its policy. The open mar

ket desk is charged with the responsibility of carrying out that policy. As a permanent member of

the FOMC, the president of the Federal Reserve Bank of New York would be aware of the intent

of the FOMC, and would under

take open market operations to facilitate this directive.

The actions of the Federal Reserve have far reaching ramifications. When we consider the future

course of the economy and inflation, consideration must also be given to the likely response of the

Federal Reserve Bank to

these developments, which will have implications for interest rates. Fixed income markets are

directly linked to interest rates. The stock market is tied to corporate profits plus the economy,

inflation and interest ra

tes. The dollar depends on U.S. interest rates relative to overseas rates. It is likely that the Fed will

continue