Thailand experienced the 1997 stock-market crash after the baht was devalued, helping start the Asian financial crisis.
Thailand abandoned its long-standing defense of the baht on July 2, 1997, allowing the currency to float. The decision followed pressure from heavy foreign borrowing, a property slump, weak financial institutions, and declining confidence in the country's fixed exchange-rate system.
The currency collapse quickly damaged companies and banks with debts denominated in foreign currencies. Thailand's stock market had already fallen substantially, and the crisis spread through Southeast Asia before reaching economies such as South Korea.
The International Monetary Fund assembled a rescue package for Thailand, with support from other institutions and governments. The episode is often called the Asian financial crisis, although it involved several countries and different local causes. The baht devaluation was the key starting point, not the later crisis in South Korea.