Which 1997 crisis began in Thailand and spread through Asian currencies, banks, and stock markets?

The 1997 crisis that began in Thailand and spread through Asian currencies, banks, and stock markets was the Asian financial crisis.

Thailand abandoned its fixed exchange-rate system for the baht on 2 July 1997 after intense pressure on its foreign-exchange reserves. The baht then lost substantial value, and investors reassessed economies across East and Southeast Asia. Indonesia, South Korea, and other countries experienced currency collapses, falling share prices, bankruptcies, and banking stress.

Many affected economies had accumulated large amounts of short-term foreign-currency debt. Property and equity prices had also risen rapidly, while fixed or tightly managed exchange rates encouraged confidence that proved fragile. Once capital began leaving, companies and banks struggled to repay debts that had become much more expensive in local currency.

The International Monetary Fund arranged assistance programs for Thailand, Indonesia, and South Korea. Hong Kong’s stock market was also hit, although its currency peg survived. The crisis was regional, but its consequences reached global financial markets.