overheato·ver·heat /ˌəʊvəˈhiːtˌoʊvər-/ verb [intransitiveI, transitiveT]ECONOMICS if an economy overheats, demand rises too fast, causing prices and imports to rise, a situation that governments may try to correct by raising taxes and interest ratesLifting economies out of recession is easy compared with deciding when to re-apply the brakes so the economy does not overheat later.
Germany overheated its economy as it poured money into rebuilding the East.
—overheating noun [uncountableU]Economic growth is modest, with little fear of overheating.