Currency Crisis

A currency crisis occurs when a country's currency rapidly loses value against other currencies, leading to economic instability. This can happen if investors lose confidence, if the country faces large debts, or if economic policies undermine trust. As the currency devalues, prices of imported goods rise, inflation can spike, and people may withdraw their money or avoid investments, worsening financial chaos. Governments may intervene to stabilize the currency, but if they fail, the crisis can harm the economy, lead to recession, and increase poverty. It reflects a loss of confidence in a country's financial stability and management.