HISTORICAL EVENTS IN THE FX MARKET
HISTORICAL EVENTS IN THE FX MARKET ASIAN FINANCIAL CRISIS (1997–1998) _____________________________________________________________ Falling like a set of dominos on July 2, 1997, the relatively nascent Asian tiger economies created a perfect example in showing the interdependence of global capital markets and their subsequent effects throughout inter national currency forums. Based on several fundamental breakdowns, the cause of the contagion stemmed largely from shrouded lending practices, inflated trade deficits, and immature capital markets. Added together, the factors contributed to a “perfect storm” that left major regional markets incapacitated and once-prized currencies devalued to significantly lower levels. With adverse effects easily seen in the equities markets, currency market fluctuations were negatively impacted in much the same manner during this time period. The Bubble Leading up to 1997, investors had become increasingly attracted to Asia