credit squeeze: meaning, definition, pronunciation and examples
C1Formal, Financial/Business, Journalistic
Quick answer
What does “credit squeeze” mean?
A period when governments or central banks make it much harder and more expensive for individuals and businesses to borrow money.
Audio
Pronunciation
Definition
Meaning and Definition
A period when governments or central banks make it much harder and more expensive for individuals and businesses to borrow money.
A deliberate tightening of monetary policy, restricting the availability of credit to control inflation or stabilize an economy; also used metaphorically to describe any severe restriction of resources.
Dialectal Variation
British vs American Usage
Differences
Term is used identically in financial contexts. Slightly more common in UK financial reporting.
Connotations
Carries negative economic associations universally.
Frequency
Low-frequency term that spikes in usage during economic downturns or periods of tight monetary policy.
Grammar
How to Use “credit squeeze” in a Sentence
[Government/Central Bank] imposed a credit squeeze on [the economy/sector].The [economy/businesses] suffered from a credit squeeze.A credit squeeze led to [consequence].Vocabulary
Collocations
Examples
Examples of “credit squeeze” in a Sentence
verb
British English
- The Chancellor is poised to credit-squeeze the overheating property market.
- They feared being credit-squeezed out of existence.
American English
- The Fed is expected to credit-squeeze the economy to curb inflation.
- Small businesses were credit-squeezed by the new regulations.
adverb
British English
- The economy was operating credit-squeezed for most of the year. (Rare)
American English
- The sector performed credit-squeezed in the last quarter. (Rare)
adjective
British English
- The credit-squeeze environment is challenging for start-ups.
- We are in a credit-squeeze period.
American English
- The credit-squeeze policy has slowed growth.
- Facing credit-squeeze conditions, the company halted hiring.
Usage
Meaning in Context
Business
The credit squeeze has forced us to postpone our expansion plans.
Academic
The 1970s credit squeeze is analyzed as a key response to stagflation.
Everyday
It's hard to get a mortgage right now with this credit squeeze.
Technical
The central bank initiated a credit squeeze by raising reserve requirements and the discount rate.
Vocabulary
Synonyms of “credit squeeze”
Strong
Neutral
Weak
Vocabulary
Antonyms of “credit squeeze”
Watch out
Common Mistakes When Using “credit squeeze”
- Using 'credit squeeze' to describe personal debt problems (it's a macroeconomic term).
- Misspelling as 'credit squeze'.
- Confusing verb and noun: 'The bank credit squeezed' is incorrect; 'The bank imposed a credit squeeze' is correct.
FAQ
Frequently Asked Questions
No. A credit squeeze is a deliberate policy action by authorities. A credit crunch is a severe, often market-driven, shortage of credit availability that can result from or be independent of policy.
A credit squeeze is typically imposed by a country's central bank (e.g., the Bank of England, the Federal Reserve) or government through policy tools like raising interest rates or increasing bank reserve requirements.
Common effects include reduced borrowing and spending, slower economic growth, decreased business investment, falling asset prices (like houses), and potentially rising unemployment, all aimed at reducing inflationary pressure.
Yes, but it is less common and somewhat informal/jargonistic (e.g., 'The economy was credit-squeezed'). The noun form ('impose a credit squeeze') is standard.
A period when governments or central banks make it much harder and more expensive for individuals and businesses to borrow money.
Credit squeeze is usually formal, financial/business, journalistic in register.
Credit squeeze: in British English it is pronounced /ˈkrɛdɪt skwiːz/, and in American English it is pronounced /ˈkrɛdɪt skwiːz/. Tap the audio buttons above to hear it.
Phrases
Idioms & Phrases
- “Feel the squeeze (broader idiom applicable in this context)”
- “Tighten the purse strings (related concept)”
Learning
Memory Aids
Mnemonic
Imagine a giant hand SQUEEZING a tube of toothpaste labeled CREDIT. Less and less money (toothpaste) can come out.
Conceptual Metaphor
ECONOMIC PRESSURE IS PHYSICAL CONSTRICTION / MONEY IS A LIQUID (being squeezed out).
Practice
Quiz
What is the primary purpose of a 'credit squeeze'?