While the inflation performance was good by developing economy standards, it was consistently higher than inflation in the U.S., the country to which exchange rates were pegged. As a result, there was a tendency toward real appreciation, which contributed to the deteriorating current account deficit in several of the crisis countries.
Monetary policy during the speculative attack While monetary policies may not have been inappropriate in the years prior to 1997, they were probably not tightened sufficiently or for long enough in the immediate pre-devaluation phase of the emerging crises in the developing Asian economies.