Thailand moves the baht to a managed float

Conditions at the time

The policy change was announced amid currency-defense pressures and financial-sector difficulties.

How events unfolded

The transition began on 7/2, and the central bank raised Bank Rate from 10.5% to 12.5%.

Stakeholders and impacts

Foreign-currency debt holders and financial institutions faced repayment burdens from exchange-rate adjustment.

Information available at the time

The IMF’s announcement that day stated that additional measures were being considered to mitigate adverse effects on debt repayment and prices.

Findings confirmed later

Subsequent assessments discuss foreign-currency debt burdens, nonperforming loans and regional financial turmoil together.

Alternative interpretations and limitations

A managed float, not a completely free float. The entire Asian crisis is not asserted as the result of this decision alone.

Interpretation using later sources

The exchange-rate change did not make the subsequent recession and recovery foreseeable with certainty. The IMF's 2000 assessment records initial fiscal and monetary tightening followed by easing to cushion the recession. Reserves and exchange-rate stability improved, while bad loans and corporate debt restructuring remained concerns. Currency stabilization and resolution of financial distress are different measures; an assessment by a program institution is not independent causal identification of policy effects.

Evidence coverage through 2000-02-10 · Sources checked 2026-10-14

• IMF Concludes Article IV Consultation with Thailand ↗

Related events and periods1

• Global economic integration, IT investment, and recurring financial crises →

  An event or period whose recorded start falls within this editorial interval. This does not establish that it caused or represents the characteristics of the era, nor guarantee that the entire period falls within the interval.