Which 1997 financial crisis began in Thailand after the baht was floated?

The 1997 Asian financial crisis began in Thailand after the country floated the baht on July 2, 1997.

Thailand had maintained a de facto peg to the U.S. dollar while borrowing heavily in foreign currencies. Rapid credit growth, property speculation, and concerns about Thailand’s reserves made the baht vulnerable to speculative pressure.

After the peg was abandoned, the baht depreciated sharply. Financial stress spread across East and Southeast Asia, affecting Indonesia, South Korea, Malaysia, and other economies. Stock markets fell, currencies weakened, companies struggled with foreign-currency debts, and banks required restructuring.

The International Monetary Fund organized support programs for several affected countries, including Thailand, Indonesia, and South Korea. The crisis was not simply a stock-market event: currency mismatches, banking weaknesses, and capital outflows were central. Its consequences also prompted debate about IMF conditions and the risks of rapidly liberalized financial markets.