Quantitative Tightening (QT) is a type of monetary policy followed by central banks by which a central bank decreases the amount of liquidity within the economy, reducing the financial assets - no longer buying financial assets from commercial banks and other financial institutions. The Quantitative Tightening also means that the central bank may increase interest rates as a tool to curb the money supply in the economy. (Also, known as balance sheet normalisation; Opposite of the Quantitative Easing (QE))
Related Definitions in the Project: The Commercial Definitions
