Welcome to the Financial Times Lexicon

Browse thousands of words and phrases selected by Financial Times editors and suggest new terms for the glossary.

 

Term of the day

monetisation

Monetisation refers to the conversion of an object into money, which means that it is generally accepted as a medium of exchange. Metals are monetised as coins once they are standardised in weight and accepted as money.

Government debt can also be monetised, which occurs when a government replaces its interest-bearing debt with money.

ExampleHere is how the process of debt monetisation works.

When a government spends in excess of its tax revenue it must borrow from the public. The public purchases...