GLOBAL ECONOMY

Global Economy



Global Economy

Introduction

Currency crises are when speculators sell the domestic currency short en mass in anticipation of near devaluation. This imposes a great deal of pressure on foreign exchange market that can be eliminated through depreciation, increasing interest rate, or losing foreign reserves. The crises in Latin America in the late 1970s and early 1980s, England crisis of 1994 and Asian financial crises of 1997-1998 are examples of such crises. While the causes of currency crises have been well-studied, only a few studies have addressed what happens in the wake of a currency crisis to a number of ...