Which 1997 financial crisis began with the devaluation of Thailand’s baht and triggered market crashes across Asia?

The 1997 Asian financial crisis began when Thailand devalued the baht on July 2, 1997, helping trigger market crashes and currency collapses across Asia.

Thailand had maintained a close link between the baht and the U.S. dollar while borrowing heavily in foreign currencies. Speculators attacked the currency, and the government eventually abandoned its fixed exchange-rate policy. Investors then reassessed risks in Indonesia, South Korea, Malaysia, and other economies.

Stock markets fell, currencies weakened, businesses struggled to repay dollar-denominated debt, and several countries required international assistance. The International Monetary Fund arranged major rescue programs, especially for Thailand, Indonesia, and South Korea.

The crisis is sometimes described as purely a stock-market event, but currency mismatches, banking problems, property booms, and sudden capital outflows were central to its spread.