The Thai baht was devalued in July 1997, helping trigger the Asian financial crisis and regional stock-market crashes.
Thailand had maintained a close link between the baht and the U.S. dollar. Speculators attacked the currency after concerns grew about Thailand’s foreign-currency debts, property-market weakness, and dwindling reserves. On July 2, 1997, Thailand abandoned its fixed exchange-rate system and allowed the baht to float.
The currency’s fall rapidly spread through financial markets. Investors reassessed other economies with large foreign debts or similar exchange-rate arrangements, putting pressure on Indonesia, South Korea, Malaysia, and the Philippines. Stock markets declined as currencies weakened and companies struggled to repay dollar-denominated loans.
The crisis was regional rather than a single stock-market crash. International assistance, including programs organized by the International Monetary Fund, supported several affected economies, while the downturn produced major political and social consequences.