The 1994 Mexican financial crisis that followed the peso devaluation is called the Tequila Crisis.
The crisis began after Mexico devalued the peso in December 1994. Investors rapidly withdrew capital, and the currency lost much of its value. Mexico faced a severe liquidity problem because it had substantial short-term, dollar-linked obligations.
The United States and international institutions organized a rescue package worth tens of billions of dollars. The support helped Mexico avoid an outright default and stabilize its financial system, although the country experienced a deep recession and significant social costs.
The nickname refers to Mexico’s association with tequila and became widely used in discussions of emerging-market crises. It is also called the Mexican peso crisis. It should not be confused with the 1997 Asian financial crisis, which began with pressure on Thailand’s baht and spread across several Asian economies.