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Federal Reserve meeting

Everything you need to know about the Federal Open Market Committee (FOMC) meeting - including when it is and why it's important to traders'

What is the Federal Open Market Committee meeting?

The Federal Open Market Committee (FOMC) meeting is a regular session held by the members of the Federal Open Market Committee, a branch of the Federal Reserve that decides on the monetary policy of the United States.

After deliberating on short-term monetary policy, the FOMC will decide on a target federal funds rate that they believe will achieve their aims.

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When is the next Fed announcement?

The next Federal Open Market Committee (FOMC) meeting will take place on 27 - 28 March 2021, with any changes to monetary policy announced immediately after.

See a full calendar of FOMC dates

What happened at the last Fed meeting?

At the last Fed meeting - which concluded on 17 March 2021 - the FOMC announced that it expects to keep interest rates at current levels through to 2023. It also projected that the US economy will grow by 6.5% in 2021, and 3.3% and 2.2% for 2022 2023 respectively.

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How does the Fed meeting affect traders?

The FOMC meeting is usually considered the most important date on any trader's calendar, for one overriding reason: interest rates.

Using a trio of policy tools, the FOMC can raise or lower the federal funds rate in the US.

This central rate change will trickle down to other interest rates, including FX rates and bond prices, which can have a big impact on traders.

Which markets are affected by the FOMC?

If the FOMC chooses to raise or lower interest rates, the effects will reverberate across global financial markets. Here are a few specific markets to watch out for:

  • Forex: Any interest change will play out on the US dollar, by far the world’s most traded currency.
  • Indices: Higher rates tend to be bad for shares, will lower rates can be a boon.
  • Bonds: US bonds are often where the fallout from interest changes is felt most directly.

So traders and investors around the world will attempt to predict where monetary policy is headed next in each Fed meeting, and adjust their strategies and portfolios accordingly.

Find out more about how the FOMC affects interest rates.

Markets Sell Buy Updated Change
Wall Street
US 500
10-Year T-Note Decimalised
Spot Gold

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What is the federal funds rate?

The federal funds rate is the interest rate that banks charge each other for overnight loans, meaning that it effectively acts as the base interest rate for the US economy. Changes to the federal funds rate will impact short and long-term interest rates, forex rates, and eventually economic factors like unemployment or inflation. This, in turn, will play out across the global economy.

How does the FOMC affect the federal funds rate?

While it doesn’t have a direct say over the rates charged by banks to lend money to each other, the FOMC can indirectly change the fed funds rate using three policy tools that affect money supply. These are open market operations, the discount rate, and reserve requirements.

The FOMC is specifically in charge of open market operations, while the Federal Reserve Board is in charge of the discount rate and reserve requirements.

Open market operations

Open market operations are the buying and selling of government bonds on the open market.

When the FOMC wants to decrease monetary supply it will sell bonds, taking money out of the economy and in turn raising interest rates. When it wants to increase money supply, it will buy bonds, injecting money into the economy and lowering rates.

The discount rate

As well as borrowing this money from each other at the federal funds rate, banks can borrow money directly from the Federal Reserve itself. 

The interest rate a bank will have to pay to borrow from the Fed is called the discount rate. A lower discount rate will encourage a lower federal funds rate, and vice versa.

Reserve requirements

Reserve requirements are the percentage of a bank’s deposits from customers that it has to hold in order to cover withdrawals.

If reserve requirements are raised, then banks can loan less money and will ask for higher interest rates. If they are lowered, then the opposite happens.

Federal Reserve quantitative easing

Quantitative easing (QE) is an extra measure that the Fed can apply in times of severe financial crisis. It is usually only used once the above policy tools have been exhausted – the federal funds rate is near zero, and economic growth is still faltering. What does the Fed do next?
In function, QE looks fairly similar to open market operations. The FOMC buys securities on the open market, injecting money directly into the system. However, there are two key differences between the two:
  • Different assets are bought. Instead of focusing on short-term bonds, the FOMC will usually buy longer term securities, to reduce rates over the long term as well as the short term 
  • The aim is different. While open market operations are intended to lower the federal funds rate, QE purchases aim to massively increase money supply by adding to the Fed’s reserves
After the 2008 recession, the Fed undertook a series of QE programmes, pouring trillions of dollars into the US economy. However, it’s unclear how much QE helped the US economy recover.

Fed meeting dates

The FOMC will typically meet eight times a year, although there is scope for additional meetings if required. While any policy changes are announced immediately, the meetings are always secret, with minutes released three weeks after each session.

2021 FOMC dates


Minutes released

26 - 27 January


16 - 17 March*


27 - 28 April


15 - 16 June*


27 - 28 July


21 - 22 September*


2 - 3 November


14-15 December*


*Meetings are tentative until confirmed at the preceding session.

FOMC key people

The FOMC is made up of seven members of the Federal Reserve Board, plus five Federal Reserve Bank presidents.

The seven board members are all appointed by the US president, and the board chair usually serves as the chair of the FOMC. The five bank presidents consist of the president of the Federal Reserve Bank of New York – who also serves as the FOMC vice-chair – plus four others, rotated on a yearly basis.

Analysts will sometimes classify FOMC members as monetary hawks and doves with the aim of predicting the outcome of meetings.

2021 committee members

Member Role

Jerome Powell

Chairman, Federal Reserve board of governors
Richard H. Clarida Vice Chairman, Federal Reserve board of governors (bank president, New York)
Randal K. Quarles Federal Reserve board of governors

Lael Brainard

Federal Reserve board of governors

Michelle W. Bowman

Federal Reserve board of governors

Christopher J. Waller

Federal Reserve board of governors
Vacant Federal Reserve board of governors
Vacant Federal Reserve board of governors

Thomas Barkin

Bank president, Richmond
Charles Evens Bank president, Chicago
Raphael Bostic Bank president, Atlanta
Mary Daly Bank president, San Francisco

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