British Pound: What Every Trader Needs to Know

What is the British Pound?

The Pound Sterling, abbreviated as GBP for “Great British Pound”, is the official currency of the United Kingdom. It is the world’s oldest currency that is still in use. Its name derives from the Latin word “libra”, meaning “pound”, and is denoted as £.

The first use of the pound can be traced back to 775 AD, when silver pennies were the main currency in the Anglo-Saxon kingdoms. Prior to the use of the decimal system, the pound’s value was equal to 240 sterling silver pennies, which was equivalent to one pound of silver. In 928, the pound was made the official currency of Anglo-Saxon England. In 1717, the United Kingdom moved away from silver and re-defined their currency’s value in terms of gold.

History of the Bank of England

In 1694, the Bank of England (BoE) was established. It is the world’s second-oldest central bank. It was established as a way to fund the military effort during the Nine Years’ War and was initially created as a private entity that functioned as a banker to the government.

In 1844, the passage of the Bank Charter

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