Moscow’s stock exchange was closed during the 1998 Russian financial crisis.
Russia’s crisis intensified in August 1998 as falling oil prices, weak tax collection, political uncertainty, and heavy government borrowing undermined confidence. On August 17, the government devalued the ruble, declared a moratorium on some foreign debt payments, and announced a restructuring of domestic debt.
Trading in Moscow was disrupted as authorities attempted to contain the panic. The crisis damaged banks, businesses, and household savings, while the ruble lost much of its value. Russia’s debt default also contributed to international concern about emerging markets and helped expose the vulnerability of highly leveraged investors.
The episode is often linked to the collapse of Long-Term Capital Management in the United States, but the hedge fund was not a Russian institution. Its failure followed the Russian turmoil and reflected the way losses and risk-taking had become interconnected across global financial markets.