Which 1997–1998 crisis began in Asia and caused the Thai baht, Indonesian rupiah, and South Korean won to plunge?

The 1997–1998 crisis that caused the Thai baht, Indonesian rupiah, and South Korean won to plunge was the Asian financial crisis.

The crisis began with pressure on Thailand’s baht in 1997. Fixed or tightly managed exchange rates, heavy foreign borrowing, property speculation, and fragile banking systems left several economies exposed. When confidence weakened, investors withdrew capital and governments struggled to defend their currencies.

The turmoil spread to Indonesia, South Korea, Malaysia, and the Philippines, while Hong Kong’s stock market also came under severe pressure. The International Monetary Fund arranged major assistance programs for Thailand, Indonesia, and South Korea, usually with conditions involving fiscal, monetary, and structural reforms. Russia and Brazil later experienced related market stress, but their crises had distinct domestic causes.

The Thai baht’s forced float on July 2, 1997, is often treated as the starting point. That date is different from the separate Mexican peso crisis of 1994 and the Russian default crisis of 1998.