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Monetary policy glossary


A risk control measure applied to underlying assets whereby the value of those underlying assets is calculated as the market value of the assets reduced by a certain percentage (the “haircut”). Haircuts are applied by a collateral taker in order to protect itself from losses resulting from declines in the market value of a security in the event that it needs to liquidate that collateral.

Harmonised Index of Consumer Prices (HICP)

The index of consumer prices calculated and published by Eurostat, the Statistical Office of the European Union, on the basis of a statistical methodology that has been harmonised across all EU Member States. The HICP is the measure of prices used by the Governing Council to define and assess price stability in the euro area as a whole in quantitative terms.

harmonised long-term interest rate

Article 4 of Protocol (No 13) on the convergence criteria referred to in Article 140 of the Treaty on the Functioning of the European Union requires interest rate convergence to be measured by means of interest rates on long-term government bonds or comparable securities, taking into account differences in national definitions. In order to fulfil this Treaty requirement, the European Central Bank has carried out conceptual work on the harmonisation of long-term interest rate statistics and regularly collects data from the national central banks, in cooperation with and on behalf of Eurostat. See also European Central Bank (ECB), Eurostat, national central bank (NCB), Treaty on the Functioning of the European Union (TFEU)


See Harmonised Index of Consumer Prices (HICP)


One of the institutional sectors in the European System of Accounts 2010 (ESA 2010). The household sector covers individuals or groups of individuals as consumers, but also as entrepreneurs (i.e. sole proprietorships and partnerships). Non-profit institutions serving households are a separate institutional sector according to the ESA 2010, although they are often reported together with households.