Outrageously Funny Word Dictionary :: Forwardation

👉 Forwardation is a mechanism in which a central bank or government agency, such as the Federal Reserve of the United States, allows banks to lend money at a higher interest rate than they would be willing to pay on borrowed funds. This practice can help stimulate economic growth by encouraging banks to lend more and allowing them to borrow less, thus reducing the risk of default. Forwardation is often used in international trade, particularly for financial transactions between countries or regions where there is a lack of liquidity. It is

forwardation