What was the 1997 crisis called after Thailand’s baht was devalued and financial turmoil spread across East Asia?

The 1997 financial turmoil that began with Thailand’s baht devaluation was called the Asian financial crisis.

Thailand abandoned its fixed exchange-rate policy on July 2, 1997, allowing the baht to fall sharply. Investors then attacked or withdrew funds from other economies with high foreign-currency debts, including Indonesia, South Korea, and Malaysia.

Stock markets plunged, currencies weakened, companies failed, and banking systems came under intense pressure. The International Monetary Fund organized major rescue programs, notably for Thailand, Indonesia, and South Korea, although the conditions attached to those programs remain debated.

The crisis was not simply a stock-market event. Currency mismatches, short-term borrowing, weak financial regulation, and rapid capital outflows all amplified the market collapses. Hong Kong’s monetary system also came under attack, but its currency peg survived.