Which currency’s devaluation on August 17, 1998, marked Russia’s financial crisis?

The Russian ruble’s devaluation on August 17, 1998, marked the central shock of Russia’s 1998 financial crisis.

Russia widened the ruble’s trading band, announced a de facto devaluation, and suspended payments on some domestic debt. The government was struggling with weak tax collection, large budget deficits, falling oil prices, and the burden of short-term borrowing. Political uncertainty also made investors less willing to keep financing the state.

The crisis caused banking failures, inflation, and a sharp decline in confidence. It also contributed to the collapse of the U.S. hedge fund Long-Term Capital Management, whose highly leveraged positions were threatened by market turmoil. The Federal Reserve helped coordinate a private-sector response to reduce wider systemic risk.

Russia later benefited from higher oil prices and improved fiscal conditions, but the 1998 episode remains a major example of sovereign-debt and currency stress interacting with international financial markets.