Why is it the fed's responsibility to set interest rates, not national banks?

Question

A. The fed is responsible for printing all money.
B. There are not very many national banks, so few are qualified.
C. The Fed consults national banks, but they do not make the final decisions.
D. National banks are for profit, so they are not looking at the overall economy.

Answer 1

The correct answer is D. National banks are for profit, so they are not looking at the overall economy.

The Federal Reserve (the Fed) is tasked with setting interest rates primarily to manage broader economic goals such as controlling inflation, maximizing employment, and stabilizing the financial system. National banks, being profit-driven institutions, focus primarily on their own financial interests and profitability, which may not align with the overall economic needs. The Fed's decisions aim to consider the health of the entire economy rather than the interests of individual banks.