| Discount lending | Lending by the Federal Reserve to commercial banks.
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| Discount rate | The interest rate at which the Federal Reserve makes discount loans to commercial banks.
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| ECB's Deposit Facility | Where euro-area banks with excess reserves can deposit them overnight and earn interest.
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| ECB's Main Refinancing Operations | The weekly auction of two-week repurchase agreements in which the ECB, through the National Central Banks, provides reserves to banks in exchange for securities.
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| ECB's Marginal Lending Facility | The facility through which the ECB provides overnight loans to banks; the analog to the Federal Reserve's primary credit facility.
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| Inflation targeting | A monetary policy strategy that involves the public announcement of a numerical inflation target, together with a commitment to make price stability the central bank's primary objective to which all other objectives are subordinated.
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| Intermediate targets | Variables that are not directly under the central bank's control but lie somewhere between the tools policymakers do control and their objectives; the quantity of money is an example.
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| Lagged-reserve accounting | The procedure where a bank's reserve requirement is computed based on the level of deposits several weeks earlier.
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| Lender of last resort | The ultimate source of credit to banks during a panic. A role for the central bank.
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| Market federal funds rate | The overnight interest rate at which lending between banks takes place in the market; differs from the federal funds rate target set by the FOMC.
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| Matched-sale purchase (reverse repo) | A short-term arrangement in which the Federal Reserve's Open Market Trading Desk sells a security and agrees to repurchase it in the near future.
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| Minimum bid rate | The minimum interest rate that banks can bid for reserves in the ECB's weekly refinancing operation; the European equivalent of the Fed's target federal funds rate; also known as the target refinancing rate.
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| Open market trading desk | The group of people at the Federal Reserve Bank of New York who purchase and sell securities for the Fed's System Open Market Account.
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| Operating instruments | The policy instruments that the central bank controls directly; the federal funds rate is an example.
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| Overnight cash rate | The overnight interest rate on interbank loans in Europe; the European analog to the market federal funds rate.
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| Primary credit | The term used to describe short-term, usually overnight, discount loans made by the Federal Reserve to commercial banks.
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| Primary discount rate | The interest rate charged by the Federal Reserve on primary credit; also known as the discount rate, it is usually 100 basis points above the target federal funds rate.
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| Repurchase agreement (repo) | A short-term collateralized loan in which a security is exchanged for cash, with the agreement that the parties will reverse the transaction on a specific future date, as soon as the next day.
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| Reserve requirement | Regulation obligating depository institutions to hold a certain fraction of their demand deposits as either vault cash or deposits at the central bank.
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| Seasonal credit | Discount lending made in response to local, seasonal liquidity needs; used primarily by small agricultural banks in the Midwest to help manage the cyclical nature of farmers' loans and deposits.
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| Secondary credit | Discount lending to banks that are not sufficiently sound to qualify for primary credit.
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| Secondary discount rate | The interest rate charged on secondary credit; it is usually 50 basis points above the primary discount rate.
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| System Open Market Account (SOMA) | The official name for the securities holdings of the Federal Reserve System.
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| Taylor rule | A rule of thumb for explaining movements in the federal funds rate; the monetary policy rule developed by economist John Taylor.
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