Biggest Forex Rout Since ‘97 Puts Asia Central Banks in Bind
- Asian currencies are set for their worst quarter since 1997
- Central banks face pressure to hike rates as prices surge
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The surge in the dollar has set Asian currencies on course for their worst quarter since the 1997 financial crisis and created a dilemma for central bankers.
Policy makers already grappling with the fastest inflation in decades now face stark choices: forcefully raise borrowing costs to defend currencies and risk hurting growth, spend reserves that took years to build to intervene in foreign exchange markets, or simply step away and let the market run its course.