Agio

アジオ ／ agio　—　Phenomena

The difference in value between specie and paper money. A thermometer of credit.

The difference in value between specie and paper money, or between money of account and physical money. In Amsterdam, the bank gulden often maintained a premium of 4–5 percent over currency in circulation, showing that the money of account was trusted.

⚠ When the direction of the difference reverses and paper is discounted, it is a sign that the 'fever' of credit has cooled. Agio is called the thermometer of credit.