credit squeeze(redirected from Credit Squeezes)
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A situation in which it is difficult to finance through borrowing. A credit squeeze often occurs when economic growth is declining and/or when interest rates rise. The Federal Reserve is often blamed for credit squeezes when they raise target interest rates, but it may occur through private sector actions as well, such as a systemic rise in bad debt. See also: Credit crunch.
Restricted bank lending that is accompanied by rising short-term interest rates and a decline in economic growth. Credit squeezes are generally attributed to policy actions of the Federal Reserve.