FED closely-watched indicators

Key economic indicators that the Fed watches in order to anticipate a change in the Fed's monetary policy and to access the expected impact on short-term interest rates:

• Non-farm payrolls

• Industrial production
• Housing starts
• Motor vehicle sales
• Durable good orders
• National Association of Purchasing Management supplier deliveries
• Commodity prices

Source: The Big Picture


In implementing monetary policy, the Fed uses the following interest rate policy tools:

1. Open market operations
2. Discount rate
3. Bank reserve requirements
4. Verbal persuasion to influence how bankers supply credit to businesses and consumers