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The governing central bank of the US also known as "the Fed". There are twelve regional federal reserve banks in America, located in Boston, New York, Philadelphia, Cleveland, Richmond, Atlanta, Chicago, St Louis, Minneapolis, Kansas City, Dallas and San Francisco. The primary function of the Fed is twofold - (1) to maintain the stability of the US dollar and (2) to ensure economic growth. These two objectives are often directly opposed to each other because when the economy is growing rapidly inflation tends to increase. Conversely, when the Fed adopts a "hawkish" monetary policy in order to contain inflation it has the effect of reducing growth. So the Fed, through its monetary policy committee (MPC), alternates between taking steps to stimulate the economy and then taking steps to control inflation. For example, following the sub-prime crisis of 2008 and later the COVID-19 pandemic, the MPC reduced interest rates to almost zero and engaged in massive quantitative easing (Q/E) to revive the US economy. In March 2022, with the pandemic more-or-less under control and the consumer price index (CPI) rising to a 40-year high of 7,9%, the MPC began an aggressive cycle of interest rate increases to control inflation while at the same time reducing the size of the Fed's balance sheet though quantitative tightening. The activities of the Fed have a direct impact on Wall Street and the progress of the S&P500 - and hence on stock markets around the world, including the JSE.

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