A currency is a standardization of money in any form, in use or circulation as a medium of exchange, for example banknotes and coins. A more general definition is that a currency is a system of money in common use within a specific environment over time, especially for people in a nation state. Under this definition, the British Pound Sterling (£), euros (€), Japanese yen (¥), and U.S. dollars (US$) are examples of (government-issued) fiat currencies. Currencies may act as stores of value and be traded between nations in foreign exchange markets, which determine the relative values of the different currencies. Currencies in this sense are either chosen by users or decreed by governments, and each type has limited boundaries of acceptance; i.e., legal tender laws may require a particular unit of account for payments to government agencies.
A central bank, reserve bank, or monetary authority is an institution that manages the currency and monetary policy of a country or monetary union. In contrast to a commercial bank, a central bank possesses a monopoly on increasing the monetary base. Many central banks also have supervisory and/or regulatory powers to ensure the stability of commercial banks in their jurisdiction, to prevent bank runs, and in some cases also to enforce policies on financial consumer protection and against bank fraud, money laundering, or terrorism financing.
The euro is the official currency of 20 of the 27 member states of the European Union. This group of states is officially known as the euro area or, commonly, the eurozone, and includes about 344 million citizens as of 2023. The euro is divided into 100 euro cents.
In macroeconomics, the money supply refers to the total volume of currency held by the public at a particular point in time. There are several ways to define "money", but standard measures usually include currency in circulation and demand deposits. The central bank of a country may use a definition of what constitutes legal tender for its purposes.
In finance, an exchange rate is the rate at which one currency will be exchanged for another currency. Currencies are most commonly national currencies, but may be sub-national as in the case of Hong Kong or supra-national as in the case of the euro.
The Reserve Bank of India, abbreviated as RBI, is India's central bank and regulatory body responsible for regulation of the Indian banking system. It is under the ownership of Ministry of Finance, Government of India. It is responsible for the control, issue and maintaining supply of the Indian rupee. It also manages the country's main payment systems and works to promote its economic development. Bharatiya Reserve Bank Note Mudran (BRBNM) is a specialised division of RBI through which it prints and mints Indian currency notes (INR) in four of its currency printing presses located in Nashik, Dewas, Mysore and Salboni. The RBI established the National Payments Corporation of India as one of its specialised division to regulate the payment and settlement systems in India. Deposit Insurance and Credit Guarantee Corporation was established by RBI as one of its specialised division for the purpose of providing insurance of deposits and guaranteeing of credit facilities to all Indian banks.
Monetary policy is the policy adopted by the monetary authority of a nation to affect monetary and other financial conditions to accomplish broader objectives like high employment and price stability. Further purposes of a monetary policy may be to contribute to economic stability or to maintain predictable exchange rates with other currencies. Today most central banks in developed countries conduct their monetary policy within an inflation targeting framework, whereas the monetary policies of most developing countries' central banks target some kind of a fixed exchange rate system. A third monetary policy strategy, targeting the money supply, was widely followed during the 1980s, but has diminished in popularity since that, though it is still the official strategy in a number of emerging economies.
The foreign exchange market is a global decentralized or over-the-counter (OTC) market for the trading of currencies. This market determines foreign exchange rates for every currency. It includes all aspects of buying, selling and exchanging currencies at current or determined prices. In terms of trading volume, it is by far the largest market in the world, followed by the credit market.
In macroeconomics, an open market operation (OMO) is an activity by a central bank to give liquidity in its currency to a bank or a group of banks. The central bank can either buy or sell government bonds in the open market or, in what is now mostly the preferred solution, enter into a repo or secured lending transaction with a commercial bank: the central bank gives the money as a deposit for a defined period and synchronously takes an eligible asset as collateral.
The Central Bank of the Republic of Turkey (CBRT) is the central bank of Turkey. Its responsibilities include conducting monetary and exchange rate policy, managing international reserves of Turkey, as well as printing and issuing banknotes, and establishing, maintaining and regulating payment systems in the country.
The Bank of Korea is the central bank of the Republic of Korea and issuer of Korean Republic won. It was established on 12 June 1950 in Seoul, South Korea.
The boliviano is the currency of Bolivia. It is divided into 100 cents or centavos in Spanish. Boliviano was also the name of the currency of Bolivia between 1864 and 1963. From April 2018, the manager of the Central Bank of Bolivia, Pablo Ramos, announced the introduction of the new family of banknotes of the Plurinational State of Bolivia, started with the 10 Bs note, and then gradually arrived to introduce the 200 Bs note, presented in April 2019. The new family of banknotes of the Plurinational State received several awards such as "the best banknotes in Latin America", was highlighted by its security measures, its aesthetics and its inclusion of prominent figures in Bolivian history, being among those who awarded the "Latin American High Security Printing Press Conference".
The Convertibility plan was a plan by the Argentine Currency Board that pegged the Argentine peso to the U.S. dollar between 1991 and 2002 in an attempt to eliminate hyperinflation and stimulate economic growth. While it initially met with considerable success, the board's actions ultimately failed. The peso was only pegged to the dollar until 2002.
The peso boliviano was the currency of Bolivia from January 1, 1963, until December 31, 1986. It was replaced by the boliviano. It was divided into 100 centavos. The conversion rate was 1,000,000 pesos bolivianos to 1 boliviano. "$b." was the currency symbol for the peso boliviano.
The Unidad de Fomento (UF) is a unit of account used in Chile. It is a non-circulating currency; the exchange rate between the UF and the Chilean peso is constantly adjusted for inflation so that the value of the Unidad de Fomento remains almost constant on a daily basis during low inflation. It was created on 20 January 1967, for the use in determining the principal and interest in international secured loans for development, subject to revaluation according to the variations of inflation. Afterwards it was extended to all types of bank loans, private or special financing, purchases and investments on instalments, contracts, and some special situations. It is also used in legal standards such as the par value of stock and capitalization of companies, and fines.
The Central Bank of Iran (CBI), also known as Bank Markazi, officially the Central Bank of the Islamic Republic of Iran is the central bank of Iran.
In international finance, a world currency, supranational currency, or global currency is a currency that would be transacted internationally, with no set borders.
Modern monetary theory or modern money theory (MMT) is a heterodox macroeconomic theory that describes currency as a public monopoly and unemployment as evidence that a currency monopolist is overly restricting the supply of the financial assets needed to pay taxes and satisfy savings desires. According to MMT, governments do not need to worry about accumulating debt since they can create new money by using fiscal policy in order to pay interest. MMT argues that the primary risk once the economy reaches full employment is inflation, which acts as the only constraint on spending. MMT also argues that inflation can be addressed by increasing taxes on everyone to reduce the spending capacity of the private sector.
A daily indexed unit of account or Daily Consumer Price Index can be used in contracts or in the Capital Maintenance in Units of Constant Purchasing Power accounting model, to ensure that deferred payments and constant real value non-monetary items are indexed to the general price level in terms of a Daily Index. This is done so that the real value of these items is not affected by changes in the inflation rate or by the stable measuring unit assumption. Non-indexed units, such as contracts written in nominal currency units and nominal monetary items, incur inflation or deflation risk in the case of monetary items. During all periods of inflation, the debtor pays less in real terms than what both the debtor and creditor agreed at the original time of the contract or sale. On the other hand, in periods of deflation, the debtor pays more in real terms than the original agreed value. The opposite is true for creditors. Contracts and constant real value non-monetary items accounted in daily indexed units of account, Daily CPI or monetized daily indexed units of account incur no inflation or deflation risk, as the real value of payments and outstanding capital amounts remain constant over time while the nominal values are inflation- or deflation-indexed daily.
Constant purchasing power accounting (CPPA) is an accounting model that is an alternative to model historical cost accounting under high inflation and hyper-inflationary environments. It has been approved for use by the International Accounting Standards Board (IASB) and the US Financial Accounting Standards Board (FASB). Under this IFRS and US GAAP authorized system, financial capital maintenance is always measured in units of constant purchasing power (CPP) in terms of a Daily CPI during low inflation, high inflation, hyperinflation and deflation; i.e., during all possible economic environments. During all economic environments it can also be measured in a monetized daily indexed unit of account or in terms of a daily relatively stable foreign currency parallel rate, particularly during hyperinflation when a government refuses to publish CPI data.
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