Central Bank: The Guardian of Currency

Introduction
A central bank is a financial institution given that over the
production and distribution of money and credit for a country. In
modern economies, the central bank is usually responsible for the
monetary policy and regulation of all other banks. Central banks
are generally anti-competitive institutions. However, central bank
is not legally owned by the government but are established and
protected by government. Central bank ordinarily do not deal
directly with the public rather they are bankers bank,
communicating with commercial banks securities dealers in
carrying out their essential policy making functions.

Description
Definition: A central bank is defining as public institutions that
manages the currency of a country or a group of countries and
control the money supply.
A complete definition of central bank is an institution which is
charged with the responsibility of managing the expansion and
contraction of the volume of money in the interests of the general
public welfare- as the special powers of the central bank are
designed to enable it to control the volume of hand to hand
money and of bank credit available in the country.
Characteristics of Central Banks: The central bank is the
guardian of other banks .There are many different characteristics
of this bank than other banks. The main characteristics of a
central bank are given below in briefly.
  Single Organization: The central bank is single in every
country. No other banks are similar to this type of bank.
 Legal Entity: The central bank is established by the special
ordinance of government, so it has the legal entity.
 Bankers to the Govt: The central bank is the adviser to
the government. It provides an expert opinion on matters
relating to economic development or to monetary conditions
of a country.
 Guardian of Money Market: The bank organizing,
directing and controlling the money market.
 Note Issue: Central bank issuing note and distributing
them in the country.
 Maintains of Monetary Value: Central banks works for
maintaining the value of money. It ensures the supply of
money in the money market.
 Clearing House: The central bank arranges clearing house
for the purpose of clearing the inter-bank transactions.
 Parents of all Banks: It controls the type of banks and
works as a guardian of those banks.
 The Controller of foreign exchange: It does all kinds of
works related to foreign exchange, exchange rate, reserve,
maintaining a relationship with other country's central bank.
Goals of Central Bank: A central bank is an independent
financial institution that manages monetary policy, regulates
banks and provides financial services. Some goals of central bank
is given below in shortly.

 Price stability: The main goal of central bank is to

maintain price stability. This bank does this by money
supply, reserve rate determination and other policies.
  Full Employment: Full employment is another goal of the
central bank. However, it is not possible to keep zero(0)
percent unemployment in a country. However, if a country
has4-6 percent unemployment, it is considered as full
employment of that country.
 Economic Growth: Economic growth is important to
central banks as it generally means more jobs and better
living conditions. When there is economic growth, it is often
associated with increased business investment, improving
employment, and increasing demand.
 Balance of Payment: It is a systematic accounting balance
sheet of the country and includes both debit and credit
transactions.

There are some name of Central Bank in the World

 The Federal Reserve (United States)
 Bank of England (United Kingdom)
 Bangladesh Bank (Bangladesh)
 Reserve Bank of India (India0
 The Central Bank of the Russian Federation (Russia)

Bangladesh Bank: After the victory of Bangladesh in the war of

liberation in 1971, the government of Bangladesh established the
Dhaka branch of the State Bank of Pakistan located in Dhaka as a
the Central Bank of Bangladesh under the name of Bangladesh
Bank.
Bangladesh Bank was declared effective from 16th December 1971.
When Bangladesh Bank was established, its capital was
approximately 3 crore taka but in 2022 Bangladesh Bank capital
has more than 3400 billion taka.
There are 10 branches of Bangladesh Bank
 Motijhel
 Sadarghat
 Bogura
 Chattogram
 Rajshahi
 Barishal
 Khulna
 Sylhet
 Rangpur
 Mymenshing
Conclusion
The central bank is essential for a country's economy. When the
price of commodities go up due to inflation in the country then
the central bank will bring inflation back to normal by controlling
money supply, bank rates etc. Its issuing note and maintain
currency acts as the guardian of all types of banks in the country.
Therefore, it can be said that the role of central bank is important
in every country.
____________________________________________
Reference
European central bank
Wikipedia
Investopedia
Economics 2nd part~ Ranjit Kumar Nath
 Table of Contents
 Introduction ...........................................................................

 Description ...........................................................................

 Definition ............................................................................

 Characteristics of Central Banks ............................................

 Goals of Central Bank .............................................................

 Some name of Central Bank in the World .............................

 Bangladesh Bank ....................................................................

 Branches of Bangladesh Bank ................................................

 Conclusion ...............................................................................

 Reference ................................................................................
 Seminarr
on
Central Bank: The Guardian of Currency

Submitted by
Md. Wazed Ali
Roll: 2010842192
Session: 2019-20
Year: 1st Year 2nd Semester
Department of Economics
University of Rajshahi
Cell:01798462758
Submitted To
Kazi Julfikar Ali
Associate Professor
Department of Economics
University of Rajshahi