In central bank terminology, the liquidity (M 3) in the economy not yet absorbed by price increases and/or economic growth.
Economy. The price gap widens/ narrows if real money growth is above/below trend growth (underlying growth: the long run average rate of economic growth for a country over a period of time) of real GDP. CETERIS PARIBUS inflationary pressures rise or fall in line with this increase or decrease. – Cf. ECB Monthly Bulletin, July 2005, pp. 51 ff. (presentation; relations to potential growth).
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