A 'Sudden Stop' is defined as
A) A sudden halt in economic growth
B) An unexpected default
C) A sudden withdrawal of funding by foreign creditors
D) A quick restructuring of government debt
E) A downgrade by a credit rating agency

Question

Quizplus · Accepted Answer

A 'Sudden Stop' refers to a scenario where foreign creditors suddenly stop or drastically reduce lending to a country, leading to a crisis due to the country's inability to finance its current account deficit or repay existing debt.

A 'Sudden Stop' Is Defined as