Which 1997 crash began after Thailand abandoned its baht peg to the U.S. dollar?

The Asian financial crisis began after Thailand abandoned its baht peg to the U.S. dollar in July 1997. The baht then depreciated sharply, and financial stress spread through several economies in East and Southeast Asia.

Before the crisis, Thailand and neighboring countries had attracted large inflows of foreign capital. Banks and companies accumulated substantial short-term foreign-currency debt, while property and equity prices rose rapidly. When investors became worried about currency reserves and repayment risks, capital flowed out and exchange rates came under intense pressure.

The crisis affected Thailand, Indonesia, South Korea, Malaysia, and other economies, though its severity differed by country. International rescue programs, including a major International Monetary Fund package for South Korea, accompanied financial reforms. The crisis is sometimes called the Asian currency crisis because exchange-rate collapses were central, but its consequences included stock-market falls, recessions, and banking failures.