Thailand’s baht devaluation on July 2, 1997, helped trigger the Asian financial crisis.
Thailand had maintained a managed exchange rate while borrowing heavily in foreign currencies. Pressure on its reserves made that policy difficult to sustain, so the country allowed the baht to float and the currency fell sharply.
Financial stress then spread through several economies, including Indonesia, South Korea, Malaysia, and the Philippines. Exchange-rate collapses, corporate debt, bank failures, and capital flight created deep recessions across the region.
The crisis was not simply a stock-market event: currencies and banking systems were central. The International Monetary Fund organized assistance programs for several affected countries, although the programs and their social costs remained controversial.