Definition of British Pound Sterling

Financial Terms Beginning with B

What is the British Pound Sterling

The British pound sterling, commonly referred to as the pound, is the official currency of the United Kingdom, which includes England, Scotland, Wales and Northern Ireland. The symbol for the pound sterling is £ and its country code is GBP.

History of the British Pound Sterling

Originating in Anglo-Saxon England, the pound sterling has a deep-rooted history going back to the 8th century, making it one of the oldest currencies in continuous existence. The term pound comes from the fact that it originally represented a pound of sterling silver while the term sterling comes from the Old Norman term for little star or small star, which is “sterre”. The small star symbol was stamped on early Norman pennies.


British Pound Sterling Banknotes and Coins

In the modern financial system, the pound sterling is subdivided into 100 smaller units known as pence. The Bank of England is responsible for issuing pound sterling banknotes while the Royal Mint produces the coins. The available banknotes are £5, £10, £20 and £50 and the circulated coins are 1p, 2p, 5p, 10p, 20p, 50p, £1 and £2.

Forex and British Pound Sterling

In the forex market, the pound sterling holds a prominent position. It is one of the top five most traded currencies in the world and is also considered a reserve currency. A reserve currency is one that is held in significant quantities by governments and institutions as part of their foreign exchange reserves.

The value of the pound fluctuates and can be affected by various factors including inflation, interest rates, political stability and the economic performance of the UK, as well as other influential factors. Forex traders, investors and others closely monitor these factors as they can impact the exchange rate of the pound against other currencies.


Final Thoughts on the British Pound Sterling

In summary, the British pound sterling is a pivotal currency that carries a rich history and plays a significant role in global finance, including forex trading and currency exchange. It is the backbone of the monetary system in the UK and a cornerstone of the global economy.

GlobEx Markets Financial Dictionary of Terms, Phrases and Concepts

The GlobEx Markets financial dictionary is a reference resource that provides the definitions and explanations of various financial terms, phrases and concepts that are used in international finance and global investing. It includes a broad range of financial terms, such as those related to stocks, bonds, currencies, commodities, options, futures, crypto and much more.

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