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The FED functions as a central bank in charge of the monetary policy of the country.Usually its main task is to curtail the inflation outbreaks.The best way whenever thar happens is to raise the the refence interest rates, which will lower the bank loans, and consumption which are feeding the inflation.Pls read http://www.frbatlanta.org/invoke_brochure.cfm?objectid=883843FC-AB84-11D5-898400508BB89A83&method=display_body
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