Which 1998 crisis followed Russia’s ruble devaluation and default on domestic debt, shaking global stock markets?

The 1998 crisis triggered by Russia’s ruble devaluation and domestic-debt default was the Russian financial crisis.

Russia faced severe fiscal pressure after years of weak tax collection, falling commodity prices, and the financial aftershocks of the 1997 Asian crisis. On August 17, 1998, the Russian government devalued the ruble, declared a moratorium on some private foreign debt payments, and restructured domestic ruble-denominated debt.

The shock damaged Russian banks and investors and contributed to a sharp loss of confidence in emerging markets. It also exposed the risks carried by Long-Term Capital Management, a highly leveraged U.S. hedge fund. After major losses, the Federal Reserve helped coordinate a private-sector recapitalization in September 1998 to limit wider disruption.

The Russian crisis is often confused with the Asian financial crisis because the events were closely connected. The Asian crisis began in 1997, while Russia’s default and ruble devaluation came in 1998.