Thailand's currency crisis helped trigger the 1997 Asian financial crisis after the baht was floated.
On July 2, 1997, Thailand abandoned its fixed exchange-rate system and allowed the baht to float. The currency then fell sharply, exposing weaknesses in heavily indebted companies, banks, and property markets. Investors soon withdrew capital from other Asian economies, producing a regional financial shock.
The crisis spread to Indonesia, South Korea, Malaysia, and the Philippines, among others. International Monetary Fund assistance programs supported several affected countries, but the required reforms and austerity measures were controversial. Indonesia experienced especially severe political and economic disruption.
Thailand was the starting point, not the only country affected. The crisis also showed how quickly capital flows could transmit trouble across borders. It is sometimes called the Asian financial crisis or the Asian financial contagion, and it was primarily a currency, banking, and debt crisis rather than one isolated stock-market session.