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Functions of a central bank

It performs the following functions:
  • Note issuing agency: The central bank regulates currency in accordance with the requirements of business and public.
  • Services: It performs general banking and agency services for the state.
  • Custodian of cash reserves: It acts as a custodian of cash reserves for the commercial banks.
  • Custodian of forex reserves: It acts as a custodian of the nation’s reserve of foreign currency.
  • Controller of credit: It controls credit in accordance with monetary policy of the state.
  • Other functions: It performs additional functions to meet the specific requirements of the country.

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