Open market operation an operation executed on the initiative of the central bank in the financial market .

Maximum bid rate the upper limit to the interest rate at which counterparties may submit bids in variable rate tenders .

International investment position ( i.i.p. ) the value and composition of an economy 's outstanding net financial claims on ( or financial liabilities to ) the rest of the world .

Monetary financial institution ( MFI ) one of a class of financial institutions which together form the money issuing sector of the euro area .

Euro area the area encompassing those Member States in which the euro has been adopted as the single currency in accordance with the Treaty and in which a single monetary policy is conducted under the responsibility of the relevant decision making bodies of the ECB . The euro area comprises Belgium , Germany , Spain , France , Ireland , Italy , Luxembourg , the Netherlands , Austria , Portugal and Finland .

Purchase date the date on which the sale of purchased assets by the seller to the buyer becomes effective .

By contrast with an earmarking system , the underlying assets are not earmarked for individual transactions in a pooling system . Post fixed coupon a coupon on floating rate instruments which is determined on the basis of the values taken by the reference index at a certain date ( certain dates ) during the coupon accrual period .

Open market operation an operation executed on the initiative of the central bank in the financial market . With regard to their aims , regularity and procedures , Eurosystem open market operations can be divided into four categories main refinancing operations , longer term refinancing operations , fine tuning operations and structural operations .

Purchase price the price at which purchased assets are sold or are to be sold to the buyer by the seller . Quick tender the tender procedure used by the Eurosystem for fine tuning operations when it is deemed desirable to have a rapid impact on the liquidity situation in the market .

M1 a narrow monetary aggregate that comprises currency in circulation plus overnight deposits held with MFIs and central government ( e.g. at the post office or treasury ) .

Quick tender the tender procedure used by the Eurosystem for fine tuning operations when it is deemed desirable to have a rapid impact on the liquidity situation in the market .

Main refinancing operation a regular open market operation executed by the Eurosystem in the form of a reverse transaction .

Main refinancing operations are conducted through weekly standard tenders and have a maturity of two weeks . Maintenance period the period over which credit institutions compliance with reserve requirements is calculated .

Pooling system a system for central banks collateral management where the counterparties provide a pool of assets to serve as collateral in their transactions with the central bank .

As for the instruments used , reverse transactions are the main open market instrument of the Eurosystem and can be employed in all four categories of operations .

Non financial corporations one of the institutional sectors in the European System of Accounts 1995 ( ESA 95 ) .

Outright transaction a transaction whereby the central bank buys or sells assets up to their maturity in the market ( spot or forward ) .

ECB Annual Report 2004 International investment position ( i.i.p. ) the value and composition of an economy 's outstanding net financial claims on ( or financial liabilities to ) the rest of the world .

Pre fixed coupon a coupon on floating rate instruments which is determined on the basis of the values taken by the reference index at a certain date ( certain dates ) before the start of the coupon accrual period .

Longer term refinancing operation a regular open market operation executed by the Eurosystem in the form of a reverse transaction .

National central bank ( NCB ) as used in this document , a central bank of an EU Member State which has adopted the single currency in accordance with the Treaty .

Outright transaction a transaction whereby assets are bought or sold up to their maturity ( spot or forward ) .

Outright transaction a transaction whereby assets are bought or sold up to their maturity ( spot or forward ) .

ECBc The implementation of monetary policy in the euro area February 2005 ANNEX 2 Outright transaction a transaction whereby assets are bought or sold up to their maturity ( spot or forward ) .

Purchase date the date on which the sale of purchased assets by the seller to the buyer becomes effective . Purchase price the price at which purchased assets are sold or are to be sold to the buyer by the seller .

Overnight deposits deposits with next day maturity .

Pre fixed coupon a coupon on floating rate instruments which is determined on the basis of the values taken by the reference index at a certain date ( or dates ) before the start of the coupon accrual period .

M1 , M2 , M3 see monetary aggregates .

Liquidity risk the risk that a counterparty will not settle an obligation at its full value when due but on some unspecified date thereafter .

With regard to their aims , regularity and procedures , Eurosystem open market operations can be divided into four categories main refinancing operations , longer term refinancing operations , fine tuning operations and structural operations .

MFIs ( monetary financial institutions ) financial institutions which together form the moneyissuing sector of the euro area .

Longer term refinancing operation a regular open market operation executed by the Eurosystem in the form of reverse transactions .

Market risk the risk of losses ( in both on and off balance sheet positions ) arising from movements in market prices .

Purchase date the date on which the sale of purchased assets by the seller to the buyer becomes effective . Purchase price the price at which purchased assets are sold or are to be sold to the buyer by the seller .

M7 Quick tender the tender procedure used by the Eurosystem for fine tuning operations when it is deemed desirable to have a rapid impact on the liquidity situation in the market .

Post fixed coupon a coupon on floating rate instruments which is determined on the basis of the values taken by the reference index at a certain date ( certain dates ) during the coupon accrual period .

Eurosystem staff projections the results of exercises conducted by Eurosystem staff to project possible future macroeconomic developments in the euro area as part of the economic analysis .

The maintenance period begins on the settlement day of the first main refinancing operation following the meeting of the Governing Council at which the monthly assessment of the monetary policy stance is pre scheduled .

ECB Annual Report 2002 price is multiplied by the number of shares outstanding ) , with each stock 's weight in the index thus being proportionate to its market value .

In such cases , the relevant national central bank is responsible for informing the counterparties in advance of the arrangements to be made for transactions involving those branches .

Pre fixed coupon a coupon on floating rate instruments which is determined on the basis of the values taken by the reference index at a certain date ( or dates ) before the start of the coupon accrual period .

Outright transaction a transaction whereby assets are bought or sold up to their maturity ( spot or forward ) .

Post fixed coupon a coupon on floating rate instruments which is determined on the basis of the values taken by the reference index at a certain date ( or dates ) during the coupon accrual period .

Monetary financial institution ( MFI ) one of a class of financial institutions which together form the money issuing sector of the euro area .

Pre fixed coupon a coupon on floating rate instruments which is determined on the basis of the values taken by the reference index at a certain date ( or dates ) before the start of the coupon accrual period . Purchase date the date on which the sale of purchased assets by the seller to the buyer becomes effective .