Russia declared a sovereign debt default during the 1998 financial crisis that shook global stock markets.
On 17 August 1998, the Russian government and central bank announced a devaluation of the ruble, a restructuring of domestic ruble debt, and a temporary moratorium on some foreign debt payments. The measures followed falling oil prices, weak tax collection, political uncertainty, and pressure on Russia’s currency reserves.
The crisis spread beyond Russia through investor losses and increased fear about emerging markets. The collapse of the hedge fund Long-Term Capital Management soon threatened wider financial instability, although the fund was rescued through a private-sector arrangement organized by the Federal Reserve Bank of New York.
Russia’s 1998 event is distinct from Argentina’s later 2001 default and Brazil’s 1998 currency pressures. Those crises are often discussed together because they affected international investors, but they were separate episodes.