The Bank of England is primarily responsible for managing the Money Supply and setting interest rates. In recent times the Bank has rarely tried to influence the exchange rate. Nevertheless the Bank of England are responsible for managing the UK’s foreign exchange reserves and could influence the exchange rate if policy warranted this.
The Bank of England manages the UK’s gold and foreign exchange reserves, on behalf of HM Treasury. This is through a mechanism known as the Exchange Equalisation Account. This includes managing the issuance of foreign currency debt.
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