• Inflation expectations

    Inflation rates expected by different categories of economic agents (households, business leaders, financial market participants) for different time horizons (1 year, 3 years, 5 years, 10 years, etc.).


  • Governing Council

    Main decision-making body of the European Central Bank. It is comprised of the six members of the Executive Board and the governors of the national central banks of the euro area countries.


  • External levy

    A drain on a country’s economy due to an increase in the price of goods that the country must import.

  • Employment rate

    Share of the total working age population that is in work, expressed as a percentage.

  • Eurosystem

    The European Central Bank and the national central banks of the countries that have adopted the euro.


  • Harmonised Index of Consumer Prices (HICP)

    A price index with a definition and methodology harmonised across the European Union, allowing for comparisons between countries.


  • Indexation

    The automatic adjustment of a price or wage based on a given economic index.

  • Underlying inflation

    A measure of inflation that provides a fundamental trend in price developments. It reflects the deep evolution in production costs and the match between supply and demand. Underlying inflation is therefore more appropriate for analysing inflationary pressures, as it is less affected by exogenous factors.


  • Key interest rates

    Interest rates set by the central bank of a country or monetary union. In the euro area, the European Central Bank sets three key interest rates: the deposit facility rate, the main refinancing operations rate, and the marginal lending facility rate.


  • Minimum capital requirements

    Capital requirements defined for banks by the European regulation (CRR [Capital Requirements Regulation] including notably the Basel Committee international regulatory framework), integrating individual requirements depending on the risk profile and additional requirements depending on the so-called “macroprudential” risks identified at the level of the financial system (additional reserves, also known as “buffers” – which can be used in times of crisis).

  • Monetary aggregates

    Measures of the amount of money in circulation. The Eurosystemmonitors three aggregates, from most to least liquid :

    • M1 = coins + banknotes + overnight deposits ;
    • M2 = M1 + deposits with an agreed maturity of up to 2 years ;
    • M3 = M2 + repurchase agreements, shares or units in funds + debt securities with a maturity not exceeding 2 years.
  • Median

    A value that divides a distribution into two equal parts. For example, in a distribution of wages, 50% of wages are below the median value and 50% are above it.

  • Margin rate

    A measure of the level of profitability of a company or sector. In national accounting, the ratio of gross operating surplus to value added.


  • Neutral rate

    The theoretical level of the interest rate at which monetary inflation neither accelerates nor slows.


  • Purchasing power

    The amount of goods and services that can be purchased with income; it therefore depends on both the level of income and the level of prices.

  • Price shield

    A set of government measures aimed to protect consumers and businesses from excessive price increases, especially in energy (gas, electricity, fuel, etc.).

  • Potential growth

    The rate of growth of gross domestic product (GDP) that an economy can theoretically achieve by fully utilising its production capacity without creating inflationary pressures.


  • Real rate

    The real or “economic” cost of credit (as opposed to the nominal or “financial” cost), which is calculated by deducting observed or expected inflation from the nominal interest rate.


  • Terminal rate

    The maximum rate reached at the end of a phase of policy rate hikes by the central bank.


  • Venture capital

    Financing the creation or development of a risky but high potential business.