Tag Archives: Black Monday

Black Monday – 30 years on

Black Monday refers to Monday, October 19, 1987, when stock markets  around the world crashed, shedding a huge value in a very short time. In New Zealand and Australia it is sometimes referred to Black Tuesday because of the different time zone. By the end of October stock markets around the world fell significantly:

  • Canada – 22.5%
  • USA – 22.68%
  • UK – 26.45%
  • Spain – 31%
  • Australia – 41.8%
  • Hong Kong – 45.5%
  • New Zealand – 60%

Unlike other countries the effect of the crisis was compounded by the Reserve Bank of New Zealand’s inaction to lower interest rates and therefore reduce the value of the NZ dollar. This is in contrast to the USA, Germany and Japan whose banks loosened monetary policy to prevent a recession. Below is a video from the FT looking back at the events 30 years ago. Also a useful graph to put the crash in perspective – the two circled ares are the dot.com crash and the GFC.

Black Monday in context