central bank is an organization that manages the currency of a country or group of countries and controls the money supply.  Central banks have the most influence on global markets.

They can be opaque and arcane institutions, but they’re behind much of what goes on in the economy.  That is why it’s important for the average trader to understand what the central banks are doing.

By being aware of what central banks are able to do and the impact their policies may have, you’ll have a much better understanding of the way markets move.

Are the central banks easing policy? Are they lowering rates? Are they buying assets? If so, this adds money (liquidity) into the system and usually bearish for the currency.

Are they tightening monetary policy? Are they raising interest rates and/or selling assets? If so, this removes liquidity out of the system and usually bullish for the currency

Their actions, words, and forward guidance can have a huge effect on the FX market and the overall financial market.

Here's a more in-depth trader's guide on the world's major central banks.