The 1997–1998 crisis that spread from Thailand’s baht devaluation to stock markets across East Asia was the Asian financial crisis.
Thailand abandoned its fixed exchange-rate policy on 2 July 1997 after pressure on the baht became unsustainable. The currency depreciated sharply, and investors began withdrawing funds from other economies that appeared vulnerable because of heavy foreign borrowing, fixed exchange rates, property speculation, or weak financial systems.
The turmoil spread to Indonesia, South Korea, Malaysia, and the Philippines, while Hong Kong’s stock market also came under intense pressure. Stock prices and currencies fell, companies and banks faced rising debt burdens, and several governments sought assistance from the International Monetary Fund. The crisis later affected Russia and contributed to stress in global financial markets.
The event is sometimes called the Asian financial crisis rather than a single stock-market crash because it involved currencies, banks, sovereign finances, and equity markets together. Its effects differed substantially from country to country.