Market participants: the Bank of England

Probably the most well known and oldest players in the financial markets in London is the good old Bank of England.

However, whereas for instance is the gilt market it plays a central role with regard to raising finance, in this particular case it is involved much more with the implementation of policy than directly raising finance.

It can dictate what happens with interest rates and monetary policy through the money markets.

Although the Financial Services Authority, or the FSA, regulates directly and is responsible for the regulation of the money markets, in practice this is always with close consultation of the BoE.

The BoE also has an interesting sounding role called the "Lender of Last Resort".

This refers to the fact that the Bank will ensure where it really has to that the market will meet its obligations; it is not necessarily a blank cheque but it does step in when absolutely necessary.

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