Central banks in large industrialized nations

Question

Quizplus · Accepted Answer

Central banks in large industrialized nations often hold large portfolios of U.S. government Treasury securities and securities issued by other governments as part of their foreign exchange reserves. These reserves are used, among other things, to manage their own currency's value. While central banks may attempt to influence exchange rates through various means, it is not accurate to say they seldom try to influence each other's exchange rates, as coordinated interventions do occur. Therefore, options A and B are correct, making E the correct choice.

Central Banks in Large Industrialized Nations