Ho are the banks related to the forex markets?

<p>The greatest volume of currency is traded in the interbank market where banks of all sizes trade currency with each other and through electronic networks. Big banks account for a large percentage of total currency volume trades. Banks facilitate forex transactions for clients and conduct speculative trades from their own trading desks.</p><p id="isPasted">Central banks represent their nations' governments. They're extremely important players in the forex market. Open market operations and interest rate policies of central banks influence currency rates to a very large extent.</p><p>A central bank is responsible for fixing the price of its native currency on forex. This is the exchange rate regime by which its currency will trade in the open market. Exchange rate regimes are divided into floating, fixed, and pegged types.</p><p>Any action taken by a central bank in the forex market is done to stabilize or increase the competitiveness of that nation's economy. Central banks as well as speculators may engage in currency interventions to make their currencies appreciate or depreciate.</p><p>A central bank may weaken its own currency by creating additional supply during periods of long deflationary trends. This is then used to purchase foreign currency. It effectively weakens the domestic currency, making exports more competitive in the global market.</p>