Central Bank
A central bank is a country's monetary authority responsible for issuing currency, setting monetary policy, and maintaining financial stability. It manages the money supply, oversees payment systems, and often acts as lender of last resort to the banking system.
Central banks influence interest rates and manage fiat currency supply. Some also issue CBDCs for digital public money. Examples include the Federal Reserve and the ECB.
Related Terms
Fiat Currency
Fiat currency is money issued by a government and declared legal tender, but it is not backed by a p...
Interest
Interest is the cost of borrowing money or the return earned on deposited funds, typically expressed...
Federal Reserve
Federal Reserve System (Fed)
The Federal Reserve is the central bank system of the United States. It sets monetary policy, superv...
ECB
European Central Bank
The ECB is the central bank for the eurozone and is responsible for monetary policy in the region. I...
CBDC
Central Bank Digital Currency
A CBDC is a digital form of fiat currency issued by a central bank. It represents a direct claim on ...
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