The collapse of the Thai baht helped spark the regional stock-market turmoil of the 1997 Asian financial crisis.
Thailand abandoned the baht's fixed exchange-rate regime on July 2, 1997, allowing the currency to float. The baht then fell sharply, exposing heavy foreign-currency debts held by Thai companies and financial institutions. Investors reassessed risks across East and Southeast Asia, and pressure spread to other currencies, banks, and stock exchanges.
The crisis affected Indonesia, South Korea, Malaysia, and several other economies. International Monetary Fund programs provided assistance to some of the hardest-hit countries, while governments and companies endured recession, bankruptcies, and financial restructuring.
The baht was the initial trigger, but the crisis was not caused by one currency alone. Weak banking systems, short-term foreign borrowing, property bubbles, and fixed exchange rates all mattered. The Thai currency is also called the Thai baht; “baht” is the standard short answer.