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The People\u2019s Republic of China\u2019s gradual shift from a currency policy pegged to the US dollar to one that tracks the movements of a range of currencies was the correct choice given the challenges, and neighbors Malaysia and Singapore were best served by reacting in a similar way. \n\nThat\u2019s the conclusion of research presented in Global Shocks and the New Global and Regional Financial Architecture, Asian Perspectives, a new book by the Asian Development Bank Institute.\n\nThe vulnerability of the currency regimes used in Asia came into focus after the Asian financial crisis of 1997\u20131998, when the many Asian countries that had pegged their currencies to the US dollar found they had opened themselves to significant economic and financial risks. \n\nSince the crisis, countries have either chosen to let their currencies trade more freely against the dollar\u2014Indonesia, Thailand, and the Republic of Korea, for example\u2014or shifted to other methods that still retain significant control over the value of their currencies. One of the most popular of these is the basket peg, where the local currency moves in a range against a basket of currencies, rather than being pegged directly to the moves of a single one.\n\nRead the transcript\nhttps://bit.ly/2vrdKcH\n\nRead the book\nhttps://www.adb.org/publications/global-shocks-and-new-global-and-regional-financial-architecture-asian-perspectives\n\nRead the related blog post\nhttps://bit.ly/2Mv6cjP\n\nAbout the authors\nNaoyuki Yoshino the dean of the Asian Development Bank Institute.\nTamon Asonuma is an economist in the Research Department of the International Monetary Fund.\nPeter Morgan is a co-head of research at ADBI.\n\nKnow more about ADBI\u2019s work on currency policy\nhttps://bit.ly/2LPB3r3\nhttps://bit.ly/2LQpGiI