The Federal Reserve serves as the central bank of the U.S., playing a crucial role in the nation's economic and monetary policy. Its primary functions include regulating the money supply, managing interest rates, and ensuring the stability of the financial system. Through tools such as open market operations and the discount rate, the Fed aims to achieve maximum employment, stable prices, and moderate long-term interest rates. Its decisions can significantly affect inflation, economic growth, and overall public confidence in the economy, making it a pivotal player in U.S. politics.