Asian Financial Crisis

The Asian financial crisis began in July 1997 with the sharp devaluation of the Thai baht as the government was forced to dismantle its US dollar peg. This resulted in severe contagion throughout other Asian economies, especially those running large current account deficits that relied on hot foreign money inflows. The contagion manifested itself in other swingeing currency devaluations and acute declines in the value of regional stock markets and other financial assets as foreign capital flooded out.