Which 1997 financial crisis began in Thailand after the baht was forced to float on July 2?

The Asian financial crisis began in Thailand after the baht was forced to float on July 2, 1997. The change ended the currency’s long-standing link to the U.S. dollar and was followed by a sharp depreciation.

Thailand had accumulated heavy foreign-currency debts while property and stock prices rose. When investors lost confidence, capital flowed out of the country. Companies and financial institutions that had borrowed in dollars faced much higher repayment costs after the baht weakened.

The turmoil spread to Indonesia, South Korea, Malaysia, and other economies. Stock markets fell, currencies depreciated, businesses failed, and unemployment increased. International lenders provided rescue programs, including a major package for South Korea.

The crisis is sometimes called the Asian currency crisis, but it affected banking systems, companies, governments, and stock exchanges as well as exchange rates. Its effects also contributed to political change, including the resignation of Indonesia’s President Suharto in 1998.