Glossary: Eurozone

Austerity is a policy of deficit-cutting by lowering spending via a reduction in the amount of benefits and public services provided.

Bretton Woods is an agreement signed in 1944 that outlined rules and regulations for an international monetary system. The agreement established a fixed exchange rate linked to the U.S. dollar, created the International Monetary Fund (IMF) and the International Bank for Reconstruction and Development (IBRD), which would become a precursor for the modern World Bank.

Eurozone is a geographic and economic region that consists of all the European Union countries that have fully incorporated the euro as their national currency.   It is comprised of 17 of the 27 countries that have adopted the euro and has a population of over 317 million people.

European Central Bank (ECB) is one of the seven institutions created by the Treaty on the European Union in 1992.  The bank manages the euro and safeguards price stability in the European Union.

European Commission is the executive body of the European Union (EU).  The commission is responsible for proposing legislation, implementing decisions, upholding the Union’s treaties and day-to-day running of the EU.

European Union (EU) is a geo-political and economic union of 27 member states, primarily located in Europe.  With a combined population of over 500 million inhabitants, the union was created with the aim of make war unthinkable and materially impossible.

Federal Reserve System is the central system of banking in the United States.  The system is comprised of 12 banks across the United States created by the Federal Reserve Act of 1913.

Gross Domestic Product (GDP) is defined as the market value of all final goods and services produced domestically in a single year.  It is primary indicators used to gauge the health of a country’s economy.

PIGS is an acronym that refers to the economies of Portugal, Greece, Spain, and either or both Ireland and Italy.