South Korea · Japan · U.S. Treasury · Singapore · Crypto Briefing
HSBC’s chief economist cautions of parallels to 1997 Asian crisis
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Frederick Neumann sees echoes of the pre-crisis playbook in rising Treasury yields, a weak yen, and tech euphoria, but says Asia's defenses are far stronger this time.
Key facts
- The 10-year US Treasury yield has climbed to approximately 4.79%, an increase of about 80 basis points since February 2026 alone
- Before the 1997 crisis, the Japanese currency depreciated roughly 55%, sliding from 80 to 130 against the dollar
- In the early-to-mid 1990s, US Treasury rates surged from roughly 5% in October 1993 to nearly 8% by November 1994, sending shockwaves through emerging markets that depended on dollar-denominated
- In a note dated August 31, Neumann drew pointed comparisons between the current macro environment and the conditions that preceded the 1997 Asian financial crisis
Summary
The last time rising US borrowing costs, a plummeting Japanese yen, and infectious tech optimism converged in Asia, the result was a financial crisis that toppled governments and wiped out decades of economic progress. In a note dated August 31, Neumann drew pointed comparisons between the current macro environment and the conditions that preceded the 1997 Asian financial crisis. In the early-to-mid 1990s, US Treasury rates surged from roughly 5% in October 1993 to nearly 8% by November 1994, sending shockwaves through emerging markets that depended on dollar-denominated capital. Then there’s the yen.