Thailand devalued the Thai baht at the start of the 1997 Asian financial crisis.
On July 2, 1997, Thailand abandoned its managed exchange-rate regime and allowed the baht to float. The currency had faced intense speculative pressure after Thailand’s reserves became inadequate to defend its previous policy.
The baht’s fall quickly affected other economies. Investors reassessed countries with large foreign-currency debts, fragile banking systems, or heavily leveraged property markets. Indonesia, South Korea, and Malaysia experienced severe financial stress, although each country’s circumstances differed.
The crisis led to emergency international assistance, including a major International Monetary Fund program for Thailand. The event is sometimes labeled simply a stock-market crash, but it was a broader currency, banking, and sovereign-debt crisis whose effects spread across financial markets and economies.