The Thai baht was devalued first in the 1997 Asian financial crisis, helping trigger regional market turmoil.
Thailand abandoned its fixed exchange-rate system on July 2, 1997, allowing the baht to float after sustained pressure from currency speculators and dwindling foreign-exchange reserves. The currency then depreciated sharply.
Thailand's property and finance sectors had expanded rapidly, much of it funded by short-term foreign borrowing. When confidence weakened, capital flowed out, exposing banks and companies to large debts denominated in foreign currencies.
The shock spread to Indonesia, South Korea, Malaysia, and other economies. Their currencies, stock markets, and financial institutions came under intense pressure. The International Monetary Fund organized assistance packages for several affected countries, although the conditions attached to those programs remain debated. The crisis is sometimes called the Asian financial crisis, but it was not confined to stock exchanges: currencies, banks, and sovereign finances were all involved.