Which activity is commonly carried out by both central banks and commercial banks?

Show Answers

Providing banking services to the governmentOffering guidance to the government on monetary strategiesEngaging in foreign currency transactionsSetting the benchmark interest rate

Explanation

Option A refers to central banks acting as government bankers, which commercial banks typically do not do. Option B involves advising on monetary policy, a role specific to central banks. Option C, dealing in foreign exchange, is an operation performed by both commercial and central banks. Option D, setting the main interest rate, is the responsibility of central banks alone.