What are the dual mandates established by Congress for the Federal Reserve?

The dual mandates established by Congress for the Federal Reserve focus on two primary objectives: controlling inflation and maximizing employment. This dual mandate reflects the Fed's responsibility to promote a stable economic environment, which is essential for sustainable growth and overall economic health.

Controlling inflation involves implementing monetary policies that aim to keep prices stable, thus protecting the purchasing power of the currency. By managing inflation, the Federal Reserve helps to ensure a predictable economic environment that benefits consumers and businesses.

Maximizing employment refers to the Fed's role in promoting job creation and reducing unemployment. By fostering conditions that lead to job growth, the Federal Reserve contributes to a healthier economy where more people have the opportunity to work and contribute to economic output.

These objectives are interconnected; low inflation and high employment generally lead to a stronger economy, creating a balance that fosters confidence among consumers and businesses. The Federal Reserve utilizes various monetary policy tools, such as interest rate adjustments and open market operations, to achieve these mandates and respond to economic conditions.