The Discount Market
The discount market is the fusion of the London markets for sterling money-market security and short-term sterling deposits in the operations of the discount houses.
For many years it was synonymous with the London money market but with the rise to prominence of the parallel markets it became known as the "traditional" money market in comparison especially with the interbank market in sterling funds. The discount market is a comparatively recent development in English monetary history. Its origins lie in the London bill market of the early 19th century.
Now this market in short-term financial instruments consists of ten big discount houses, who are members of the London Discount Market Association, and simple bill-brokers (discount houses) who do not have a large portfolio. Through this market the Bank of England fine-tunes the nation's money supply.
The participants in the market specialize in "bill-broking" form of banking, i.e. the provision of short-term money by way of discounting bills to borrowers. Some twenty years ago much of the discount market's business was in treasury bills. Now the market deals in a wider range of short-term assets, in particular, bank bills and certificates of deposit. Generally speaking, the discount market performs the same function for the banks as the banks themselves perform for their clients: it employs profitable funds which are temporarily unused by banks and other financial houses. It participates substantially in the financing of the short-term requirements of the government by buying Treasury Bills; it holds short-term government bonds and thereby carries some of the Government's unfunded debt; and it accepts and discounts bills of exchange, thereby financing short-term commercial operations and foreign trade.
Words you may need:
discount marketучетный рынок
fusionn (зд.) слияние, объединение
prominencen важность, значимость
bill marketрынок векселей
fine-tunev (букв.) «точно настраивать» (регулировать колебания рыночных тенденций)
"bill broking"учет векселей
unfunded debtсрочный долг, текущая задолженность