Banco de España - Monetary Policy Glossary

Monetary Policy Glossary

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Economic analysis: One of the pillars of the European Central Bank framework for the thorough analysis of risks to price stability, which is the basis of the monetary policy decisions taken by the Governing Council. The economic analysis is basically focused on the assessment of the current economic and financial situation and the implicit short and medium-term risks to price stability from the perspective of the interplay of supply and demand in goods, services and factor markets during the time span stated. Due attention is paid to the need to identify the nature of shocks hitting the economy, their effects on cost and pricing behaviour and the short to medium-term prospects for their propagation in the economy. See also "Monetary analysis".
European System of Central Banks (ESCB): It comprises the ECB and central banks of all EU Member States, including those which have not yet adopted the euro and, according to the Treaty establishing the European Community, will become the common monetary authority once all the Member States form part of EMU. As there are still EU Member States which have not yet joined EMU, the Governing Council has adopted the term Eurosystem to increase transparency and better explain the structure of the monetary authority of the euro area. As long as there are still Member States which have not yet adopted the euro, it will be necessary to maintain the distinction between the ESCB and the Eurosystem, the legal framework of the ESCB being applicable to the latter. The ESCB is governed by the Governing Council and the ECB Executive Board. There is also a third governing body, the General Council, that regulates non-EMU Member States.
Eurosystem: The central banking system of the euro area. It comprises the ECB and the national central banks of those EU Member States whose currency is the euro.
Eurosystem credit assessment framework (ECAF): The framework that defines the procedures, standards and techniques to guarantee that all collateral complies with the high credit quality requirement established by the Eurosystem.