Why is it the Fed’s responsibility to set interest rates, not national banks?

Question

Responses

The Fed is responsible for printing all money.

There are not very many national banks, so few are qualified.

The Fed consults national banks, but they do not make the final decisions.

National banks are for profit, so they are not looking at the overall economy.

Answer 1

The correct response is:

National banks are for profit, so they are not looking at the overall economy.

The Federal Reserve (the Fed) has the dual mandate of promoting maximum employment and stable prices. It sets interest rates to influence economic activity, manage inflation, and achieve these broader economic goals, whereas national banks primarily operate for profit, focusing on the interests of their shareholders and customers rather than the overall economy.