National Bank of Poland
The National Bank of Poland is the central bank of the Republic of Poland and it tasks are stipulated in the Constitution of the Republic of Poland, the Act on the National Bank of Poland and the Banking Act. The fundamental objective of the NBP’s activity is to maintain price stability. Under the Monetary Policy Strategy beyond 2003 drawn up by the Monetary Policy Council, we can see that the objective of the NBP is to stabilise the inflation rate at the level of 2.5% with a permissible fluctuation band of +/- 1 percentage point. There are most important areas of activity of the NBP: monetary policy, issue of currency, development of payment system, management of official reserves, education and information, and services to the State Treasury. In the coming years, the European integration processes, including efforts aimed at Poland’s entry into the euro zone, will have the largest impact on the execution of the NBP’s tasks.
The National Bank of Poland could be a responsible for the stability of the national currency. As an issuer of currency, the NBP manages the liquidity of cash payments. The important objective of the NBP is guarding the stability of the financial system. Then, as a part of its supervisory and regulatory functions, the NBP oversees the liquidity, efficiency and security of the payment system. This also contributes to the development of a secure infrastructure of the financial market. Moreover, the NBP undertakes activities aimed at disseminating knowledge about economics, such as through publishing information on its website and operating the NBPortal – Economics Education Portal.
This central bank has a key role in a developed market economy. It fulfils the following three basic functions: Issuing bank, Banks’ bank, and Central bank of the State. The National Bank of Poland has the sole right to issue the currency that is legal tender in Poland. This also determines the amount of currency issued and the time at which the currency enters in circulation, for the liquidity of which it is responsible. In addition, it also organises money circulation and regulates the amount of currency in circulation. Then, the NBP performs regulatory functions with regard to other banks, in order to ensure the safety of deposits held by the banks and the stability of the banking sector.
The NBP maintains the monetary clearing system, services current interbank settlements and actively participates in the interbank money market. The National Bank of Poland is responsible for the stability and safety of the entire banking system which also supervises payment systems in Poland. The NBP also offers banking services to the central government, holds the accounts of government and other central state institutions, state special-purpose funds, as well as central government entities, and executes their payment orders.
Besides, the NBP also serves the currency conversion with the latest foreign exchange rates. For today, 1 USD equals with 2.85035 in PLN. PLN is Polish Zloty. It means ‘golden.’ This was introduced on January 1, 1995 as a result of the redenomination of the old currency. The Polish government stated that it would like to join the euro in 2008, but realistically it is unlikely to happen before 2010.
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