The Federal Reserve is the U.S. central bank, and it regulates the nation’s financial institutions and implements economic and monetary policies that aim to keep the economy operating at it’s best. The Fed controls the US economy through it’s regulation of interest rates. It’s policies influence commodity prices, the value of the US dollar in foreign exchange markets, government and corporate bond yields, mortgage rates, real estate prices and stock market valuations. Investors, traders and speculators need to understand what the Federal Reserve does and does not control, what the federal funds rate means and it’s relation to other interest rates, how policies are implemented and what economic data the Fed monitors.