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Central Bank Intervention |
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Central bank intervention The buying or selling of currency, foreign or domestic, by central banks in order to influence market conditions or exchange rate movements. Central Bank Intervention The practice in which a central bank buys and sells one or more currencies in order to affect the exchange rate of its own currency. To give a very simple example, if a central bank believes its own currency is overvalued it may sell that currency on the open market to increase supply. The extra supply will likely drive down the exchange rate to a lower level. Want to thank TFD for its existence? Tell a friend about us, add a link to this page, add the site to iGoogle, or visit the webmaster's page for free fun content. |
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