The Thai baht collapsed first in the 1997 Asian financial crisis.
Thailand abandoned its long-standing peg to the U.S. dollar on July 2, 1997, allowing the baht to float and sharply reducing its value. Speculators had attacked the currency after Thailand's foreign-exchange reserves came under pressure and the country struggled with large external debts and a weakened property sector.
The baht's devaluation intensified fear about other Asian economies with fixed or managed exchange rates, high foreign-currency borrowing, and fragile banks. Capital flowed out of several markets, stock prices plunged, and currencies including the Indonesian rupiah and South Korean won suffered severe losses.
The crisis spread beyond Asia through financial contagion and reduced investor confidence. The International Monetary Fund organized assistance programs for Thailand, Indonesia, and South Korea, subject to economic conditions. The event is sometimes called the Asian currency crisis, but it was also a banking, debt, and stock-market crisis.