Which 1997 crisis began with Thailand abandoning its baht peg and triggered stock-market falls across Asia?

The 1997 crisis that began with Thailand abandoning its baht peg and triggered stock-market falls across Asia was the Asian financial crisis.

Thailand floated the baht on 2 July 1997 after spending much of its foreign-exchange reserves defending the currency’s fixed exchange rate. The baht then lost substantial value, and financial pressure spread to Indonesia, South Korea, Malaysia and the Philippines. Equity markets fell sharply as investors reassessed currencies, banks and heavily indebted companies.

The crisis was not limited to stock exchanges. It involved currency devaluations, banking failures, corporate debt and emergency international lending. The International Monetary Fund arranged major assistance packages, particularly for Thailand, Indonesia and South Korea.

A common mix-up is to call this simply the “Thai baht crisis.” That describes the trigger, while the broader regional event is known as the Asian financial crisis. Russia’s 1998 default and Brazil’s later turmoil were related periods of emerging-market instability, but they were separate crises.