What is the primary role of the Federal Reserve?

The primary role of the Federal Reserve is to regulate the U.S. monetary and financial system. As the central bank of the United States, the Federal Reserve is responsible for implementing monetary policy, which involves managing interest rates and controlling the money supply to foster economic stability. This regulation helps maintain low inflation, promote maximum employment, and stabilize the financial system.

One of the key functions of the Federal Reserve includes setting the benchmark interest rates that influence credit conditions across the economy. By adjusting these rates, the Federal Reserve can either stimulate economic growth during a downturn or cool down an overheating economy. Additionally, the Fed supervises and regulates banks to ensure the safety and soundness of the banking system, which is crucial for overall economic health.

The other options describe functions that do not fall within the Federal Reserve's mandate. Enforcing immigration laws, overseeing the federal tax code, and managing national defense are responsibilities typically held by other branches and agencies of the government, highlighting the Federal Reserve's unique and specific role in shaping the economic landscape of the nation.