Central banks have the biggest impact on supply and demand levels for the currency that they oversee. That’s chiefly because they can control the base interest rate for an economy.
If you purchase an asset in a currency that has a high interest rate, you may get higher returns. This can make investors flock to a country that has recently raised interest rates, in turn boosting its economy and driving up its currency.
However, higher interest rates can also make borrowing money harder. If money is more expensive to borrow, investing is harder and currencies may weaken.
Central banks can also change the level of money supply. Quantitative easing, for instance, involves increasing the amount of currency in an economy, which will usually cause its value to depreciate.