[1] In business cycle theory and finance, any economic quantity that is positively correlated with the overall state of the economy is said to be procyclical.
In finance, an asset that tends to do well while the economy as a whole is doing poorly is referred to as countercyclical, and could be for example a business or a financial instrument whose value is derived from sales of an inferior good.
[6] The effect of the single Eurozone interest rate on the relatively high-inflation countries in the Eurozone periphery is also pro-cyclical, leading to very low or even negative real interest rates during an upturn which magnifies the boom (e.g. 'Celtic Tiger' upturn in Ireland) and property and asset price bubbles whose subsequent bust magnifies the downturns.
[citation needed] Conversely, an economic or financial policy is called countercyclical if it works against the cyclical tendencies in the economy.
[7] Keynesian economics advocates the use of automatic and discretionary countercyclical policies to lessen the impact of the business cycle.