Central banks have served as personal banks for governments since their inception, beginning with the Riksbank of Sweden in 1668. However, as central banks have expanded the modern world, their objectives as well as their tools have also evolved. When the Federal Reserve was established as the central bank of the United States in 1913, its goal was simply to promote economic stability after the economic crisis of 1907. Then, when the European Central Bank, or ECB, was established in 1998, its main goal was to establish monetary policy. While the European Central Bank and the US Federal Reserve were created with different intentions, the current economic situation and an increasingly globalized economy are forcing the organizations to become more and more similar as they face challenges similar. However, even though these banks have similar goals, their approach to the same problem often differs. The first difference between the US Federal Reserve and the European Central Bank is in their creation, due to the different events surrounding each country at the time. In the United States, “the Federal Reserve was born from the crisis of 1907”; while in Europe, “the ECB was born from the minds of European policymakers over decades” (Payden and Rygel 1). The Maastricht Treaty "provides the legal basis for the formation of the European System of Central Banks (ESCB), which comprises the European Central Bank and the national central banks (NCBs) of the 25 Member States of the European Union (EU)" ( Gerdesmeier et al.8). The ECB follows the German model of central banking, where the most important objective is to ensure price stability, while the Federal Reserve follows the Anglo-French model, where the central bank has many objectives, including business. paper......The European Central Bank and the US Federal Reserve were born out of different economic problems, with different goals, but they evolved to have a similar structure that maximizes their use of monetary policy for the common goal economic stability and prosperity. Both institutions have different levels of independence, but are increasingly involved in politics in today's world of media and media coverage. Although at first glance the European Central Bank and the Federal Reserve may seem extremely similar, these institutions are very distinct in their economic goals, as well as the tools they use to achieve them. Insight is gained not only into the economic policies and political functioning of these two countries, but also into the idea of ​​central banking as a whole, simply by examining these two similar, but distinctly different, central banking systems..