Interpolation is a placeholder used in the Notification process in Output Channels and Filter Lists. During the processing of a Filter List or an Output Channel, an Interpolation retrieves a particular value available at runtime. Interpolations are the improved version of Macros which they replace.
The term Interpolation comes from the Apache FreeMarker Template Language (FTL) which is used in the Notification process since Avantra 6. For the sake of consistency and easier reference to FTL, we stick to the terminology used in there.
The major difference between the deprecated Macros and Interpolations: the former one is always a string, the latter one can also be of type boolean, date, time, and others. In other words, Interpolations are strictly typed. However, you can always convert any Interpolation into a string.
More exactly, we had to distinguish between a variable and its value, the latter of which it gets through the process of interpolation. However, for the sake of simplicity, we stick to one term for both.