The currency devalued in July 1997, helping trigger the Asian financial crisis and a major regional market crash, was the Thai baht.
On July 2, 1997, Thailand abandoned its fixed exchange-rate system and allowed the baht to float. The currency then lost substantial value against the U.S. dollar. Investors became concerned that Thailand’s financial institutions and companies had accumulated large foreign-currency debts that were suddenly more expensive to repay.
The pressure spread rapidly across East and Southeast Asia. Stock markets and currencies in Indonesia, South Korea, Malaysia, and the Philippines suffered severe declines, although each country had different economic conditions. The crisis also affected Hong Kong and contributed to a sharp global market sell-off in October 1997.
A common mix-up is to identify the Indonesian rupiah as the original trigger; it was among the currencies hit later. The International Monetary Fund arranged a rescue program for Thailand in August 1997, followed by assistance packages for other affected economies.