WhyItDropped

Nikkei 225 · August 31, 2010

Europe's crisis and a soaring yen

-22.18%

peak-to-trough, the whole slide

100 trading days · 2010-04-05 → 2010-08-31

back to the old high on 2013-02-06

What happened that day?

  • From the high on 5 April 2010 to the low on 31 August, the Nikkei fell 22.18% over 100 trading days
  • It emerged that Greece's public finances were far worse than reported, and the alarm spread across Europe
  • When money reduces risk, the yen gets dearer, because the trade of borrowing cheap yen unwinds
  • The yen reached the eighties per dollar that year, cutting straight into exporters' profits
  • Japan's currency strengthens during other people's crises, which is why it falls harder in every one
  • This high was not recovered until February 2013

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.