4.4.3 - Role of central banks

• Central banks are crucial institutions in modern economies responsible for various functions that help maintain economic stability and support the financial system
• Key functions of central Banks

  • Implementations of monetary policy
  • Banker to the goverment
  • Banker to the banks - Lender of last resort
  • Role in regulation of the Banking Industry
• Implemention of monetary policy

  • Central banks have the primary responsibility for formulating an implementing monetary which involves managing the money supply and interest rates to achieve specific economic objectives, such as price stability and economic growth.
• The UK central banks is the bank of England
• Central banks lend to other highstreet banks like HSBC