The collapse of the Thai baht in July 1997 helped trigger the Asian financial crisis.
Thailand abandoned its fixed exchange-rate system on July 2, 1997, allowing the baht to float after intense pressure on its foreign-exchange reserves. The currency then lost substantial value, and financial stress spread across other economies in East and Southeast Asia.
The crisis affected Indonesia, South Korea, Malaysia, the Philippines, and several other markets. Many countries had accumulated large foreign-currency debts, while property and equity prices had risen rapidly. When confidence weakened, capital flowed out and debt became harder to repay. The International Monetary Fund organized assistance packages, including a major program for South Korea. The event is sometimes called the Asian contagion because financial trouble crossed national borders quickly.