WhyItDropped

Nikkei 225 · December 19, 1997

Year-End of the Asian Crisis

-5.24%

single-day change vs previous close

Part of a longer stretch

When the banks themselves failed

midway through · 1996-06-26 → 1998-10-09, -43.18% over the whole period

What happened that day?

  • 19 December 1997 — Nikkei 225 fell 5.24%
  • That month Korea accepted an IMF bailout, and the currency crisis across Asia was at its peak
  • For Japan the crisis had two layers — externally, money lent across Asia at risk; internally, bad debt already surfaced at home
  • The particular problem: Japanese banks were the region's largest lenders. Crises in Thailand, Indonesia and Korea were losses on Japanese balance sheets
  • Fell 23.45% from peak
  • This is when the Japanese government decided to inject public funds into the financial sector

Sources

Every figure on this page is recomputed from the original daily closing prices and checked against them at build time. The account of what happened is written from the sources listed above.