The Thai baht was devalued after Thailand triggered the 1997 Asian financial crisis.
On July 2, 1997, Thailand abandoned its fixed exchange-rate system and allowed the baht to float. Speculators had attacked the currency after Thailand’s economy accumulated large foreign debts, especially short-term debts, while property and financial markets weakened. The baht then lost substantial value against the US dollar.
The pressure spread across East and Southeast Asia. Indonesia’s rupiah, South Korea’s won, and Malaysia’s ringgit all came under severe stress, although each country had its own economic circumstances. Stock markets fell, companies struggled with foreign-currency debts, and several countries sought assistance from the International Monetary Fund.
The crisis is sometimes described as a single stock-market crash, but it was a broader currency, banking, and debt crisis. Thailand’s exchange-rate decision is remembered as the spark because it revealed how quickly investor confidence could move across highly connected regional markets.