Which 1994 crisis began when Mexico devalued the peso and triggered international capital flight?

The 1994 crisis that began when Mexico devalued the peso and triggered international capital flight was the Mexican peso crisis.

Mexico maintained a managed exchange-rate system in the early 1990s while attracting substantial foreign investment. Political violence, political uncertainty, and concerns about the country’s external finances increased pressure on the currency.

In December 1994, the government allowed the peso to depreciate. Investors rapidly withdrew funds, and the currency lost a large share of its value. The resulting emergency was sometimes called the Tequila Crisis.

The United States and international institutions assembled a major support package to help Mexico meet its obligations and restore confidence. The crisis is separate from the Asian financial crisis of 1997, although both demonstrated how quickly international capital could leave emerging markets.