Asian Markets Flash Warning Signs of 1997-Style Crisis

HSBC's chief economist, Frederick Neumann, has drawn parallels between current market conditions and those leading up to the 1997 Asian financial crisis.

The similarities include rising U.S. Treasury yields, a sharply weaker Japanese yen, and intense investor enthusiasm around new technology booms.

However, Neumann notes that the region's main vulnerability has changed dramatically since then.

Asia is now a net exporter of capital, with most countries in the region generating more revenue from exports than they spend on imports.

This shift means that higher dollar funding costs and a weaker yen are less likely to trigger financial contagion like the 1990s.