Which global market crisis began in Thailand in July 1997 after the baht was allowed to float?

The Asian financial crisis began in Thailand in July 1997 after the baht was allowed to float.

Thailand had maintained a currency peg to the U.S. dollar while accumulating large foreign-currency debts and experiencing rapid credit growth. Speculators attacked the baht, and on 2 July 1997 the government abandoned its fixed exchange-rate policy. The currency then lost substantial value.

Financial stress spread across East and Southeast Asia. Indonesia, South Korea, Malaysia, and the Philippines faced currency pressure, falling stock markets, banking problems, and recessions. Many firms had borrowed in dollars, so devaluation made their debts much harder to repay in local currency.

The International Monetary Fund arranged support programs for several affected countries, although the required reforms were controversial. The crisis encouraged governments and companies across the region to build larger foreign-exchange reserves and manage external borrowing more cautiously. Its effects also contributed to political change, including the resignation of Indonesia’s President Suharto in 1998.