open market operation


Open-Market Operations

The buying and selling of U.S. Treasury securities. The Federal Reserve conducts open market operations as a primary way of influencing inflation and economic growth. These securities are sold at certain interest rates as a way of controlling the money supply. See also: FOMC.

open market operation

the sale or purchase by the monetary authorities of Government BONDS and TREASURY BILLS as a means of controlling the MONEY SUPPLY. See MONETARY POLICY for further discussion.