Central banking system and its functions
Contents Definition Main functions Currency issuance Naming of central banks Main policy instruments Conclusion
Central bank Monetary authority of a country granted the exclusive privilege to lend a government its currency.
Main functions controlling money supply money issuance setting the official interest rate implementing monetary policy
Currency issuance Exclusive privilege of a central bank
Examples of naming
Main policy instruments Open market operations Reserve require ratio Discount rate policy
Open market operations Do not require the immediate printing of new currency Most frequently used tool of central bank
Required reserve ratio
Discount rate policy Affect the balance between demand and supply Taken into account before starting business
Conclusion Central bank system becomes the most important mean of economy policy in crisis period
Thank you for your attention.