What is a Federal Advisory Council?

The Federal advisory council or (FAC) is an organized body that makes consultations with and advises the Federal Reserve Board of Governors on matters pertaining to the banking industry as well as money supply. FAC comprises 12 representatives from the banking industry, each from the 12 Federal Reserve districts. The council meets four times in a year at Washington DC to make recommendations for potential policy changes and also advise the Federal Reserve Board on the banking industry. The 12 banking executives in the Federal Advisory Council are selected by the 12 Federal Reserve Banks or districts. Individuals can take up positions on the count after a series of voting at the district level. 

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How Does a Federal Advisory Council Work?

There are three formal bodies that advise and give recommendations to the Federal Reserve Board on fiscal policy, money supply, and the banking industry. They are;

• The Federal Advisory Council
• The Consumer Advisory Council, and
• Thrift Institutions Advisory Board

Amongst these three formal bodies, FAC is considered the most influential given that it comprises banking executives who offer broad insights into matters pertaining to money supply and the banking industry and their effects on the economy. The 12 executives on the council have key knowledge about the financial condition of the country and ways to forge ahead.