tight money

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Related to tightening: Monetary Tightening

Tight money

When a restricted money supply makes credit difficult to secure. The antithesis of tight money is easy money.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.

Tight Money

A situation in which it is difficult to receive credit because of the monetary policy of the central bank. Tight money occurs when the central bank has enacted relatively high target interest rates. While this usually happens when the central bank is seeking to control or is concerned about inflation, tight money can negatively impact security prices and make it hard to receive a loan for a house or business.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

tight money

A condition of the money supply in which credit is restricted and interest rates, consequently, are relatively high. Tight money generally has a negative effect on security prices, at least in the short run. Compare easy money.
Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.

tight money

or

dear money

a government policy whereby the CENTRAL BANK is authorized to sell government BONDS on the open market to facilitate a decrease in t he MONEY SUPPLY (see MONETARY POLICY).

The decrease in money supply serves to increase INTEREST RATES, which discourages INVESTMENT because previously profitable investments become unprofitable owing to the increased cost of borrowing (see MARGINAL EFFICIENCY OF CAPITAL

INVESTMENT).

Tight money policy, through MONEY SUPPLY/SPENDING LINKAGES, reduces AGGREGATE DEMAND. Contrast CHEAP MONEY.

Collins Dictionary of Economics, 4th ed. © C. Pass, B. Lowes, L. Davies 2005
References in periodicals archive ?
He adds that due to fears of a Fed tightening, the long bond's yield could stay in a trading range between 6.35% and 5.75% for the rest of the year.
Indeed, the net percentages of institutions tightening lending standards to businesses were the highest since the 1990-1991 recession!
One member indicated a strong preference for an immediate policy tightening move, largely on the grounds that under current conditions relatively rapid growth in money and credit was not consistent with continued progress toward reducing inflation.
In an earlier survey covering the first several months of 1991, about 23 percent of the banks had indicated tightening.
The prevailing obstacle to achieving predictable results during tightening lies in the countless variable parameters that effect the clamping force in a joint.
Specifically for corporate borrowers, results based on the diffusion index approach pointed to a net tightening of credit standards for the first quarter, which was attributed by respondent banks to their reduced tolerance for risk, deterioration in the profitability and liquidity of their portfolio, less favorable economic outlook, and perception of stricter financial system regulations.
In comparison, the Fed has zero experience with the massive quantitative tightening program it has undertaken and no knowledge about the time lags associated with it.
The tightening, he explained, involved stricter collateral requirements, shorter loan maturity periods, and increased use of interest rate floors, reflecting the net tightening of overall credit standards for corporate loans.
Bankers have confirmed an overall modest tightening of lending because of efforts to limit non-performing loans.
In a sensory panel study, 96% of panelists noticed a tightening effect for Easyliance--a tightening effect that was better than existing products.
Livingston, NJ, April 17, 2015 --(PR.com)-- Reflections Center for Skin & Body (www.reflectionscenter.com) is proud to introduce Uplift, a remarkable new skin tightening treatment that uses radio frequency energy and Platelet Rich Plasma therapy to tighten skin in a whole new way.
Global Banking News-February 28, 2011--Georgian central bank says more monetary tightening would impede growth(C)2011 ENPublishing - http://www.enpublishing.co.uk