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Transaction bankingSeptember 28 2010

Central banks focus on reserves and currencies

John Normand, global head of foreign exchange strategy at JPMorganCentral banks have dropped their traditional low profile - becoming more proactive, accumulating large reserves and intervening actively to support their national currencies and interests. The composition of their reserves is also changing, with a number of central banks considering moves to reduce their exposure to the US dollar, reports Joanne Hart.
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Central banks focus on reserves and currencies

Central banks used to be the shy cousins of their commercial counterparts. Rarely seen, they were shadowy figures in the hinterland of the global financial landscape, emerging only to conduct occasional spot intervention or deliver Delphic pronouncements about economics and currency flows.

The US Federal Reserve was an exception to the rule, but these days a growing number of central banks are becoming more vociferous, more high profile and more influential.

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