Which 1997 event began with Thailand’s baht devaluation and spread into a major Asian financial and stock-market crisis?

The 1997 event that began with Thailand’s baht devaluation and spread across the region was the Asian financial crisis.

Thailand abandoned its fixed exchange-rate policy on July 2, 1997, allowing the baht to fall. Investors then questioned the currencies, banks, and corporations of other economies that had accumulated foreign-currency debt or depended heavily on short-term capital inflows. Stock markets and exchange rates fell across East and Southeast Asia.

Indonesia, South Korea, and Thailand received major assistance organized through the International Monetary Fund. The crisis brought recessions, business failures, unemployment, and political upheaval in several affected countries. Hong Kong’s currency peg came under intense pressure, although it was maintained.

The crisis is sometimes called the Asian currency crisis, but “Asian financial crisis” is the broader standard name because banking systems, corporate balance sheets, capital flows, and stock markets were all affected. It was not the same event as Russia’s 1998 default, although the episodes were connected through global investor sentiment.