The Federal Reserve is a central bank, whose main function is to control the money supply. This is very relevant for an economy, since the money supply should always be monitored, because too much can cause inflation.
The instrument for the Federal Reserve to manipulate the amount of currency in circulation is monetary policy, which may be raising / lowering the interest rate or selling / buying federal government securities. That is, the Federal Reserve is a body responsible for maintaining the economic environment conducive to the growth of the economy.
