The Bank of England is the central bank of the United Kingdom. Sometimes known as the „Old Lady” of Threadneedle Street, the Bank was founded in 1694, nationalized on 1 March 1946, and gained independence in 1997. Standing at the center of the United Kingdom’s financial system, the Bank is committed to promoting and maintaining monetary and financial stability as its contribution to a healthy economy.

The Bank of England’s roles and functions have evolved and changed over its three-hundred year history. Since its foundation, it has been the Government’s banker and, since the late 18th century, it has been banker to the banking system more generally — the bankers’ bank. As well as providing banking services to its customers, the Bank of England manages the United Kingdom’s foreign exchange and gold reserves.

The Bank of England has two core purposes — monetary stability and financial stability. The Bank of England is perhaps most visible to the general public through its banknotes and, more recently, its interest rate decisions. The Bank of England has had a monopoly on the issue of banknotes in England and Wales since the early 20th century. But it is only since 1997 that the Bank has had statutory responsibility for setting the United Kingdom’s official interest rate.

Interest rates decisions are taken by the Bank’s Monetary Policy Committee. The MPC has to judge what interest rate is necessary to meet a target for overall inflation in the economy. The inflation target is set each year by the Chancellor of the Exchequer. The Bank implements its interest rate decisions through its financial market operations — it sets the interest rate at which the Bank lends to banks and other financial institutions. The Bank of England has close links with financial markets and institutions. This contact informs a great deal of its work, including its financial stability role and the collation and publication of monetary and banking statistics.

The Bank of England is committed to increasing awareness and understanding of its activities and responsibilities, across both general and specialist audiences alike. It produces a large number of regular and ad hoc publications on key aspects of its work and offers a range of educational materials. The Bank of England offers technical assistance and advice to other central banks through its Center for Central Banking Studies, and has a museum at its premises in Threadneedle Street in the City of London, open to members of the public free of charge.

Useful links

Currency of United Kingdom:

British pound

List of Central Banks:

Central Banks

Official website of The Bank of England:

www.bankofengland.co.uk

Bank of England Museum:

www.bankofengland.co.uk

The Royal Mint:

www.royalmint.com