WhyItDropped

Nikkei 225 · April 3, 1995

The day the yen hit its record

-4.70%

single-day change vs previous close

Part of a longer stretch

The Kobe quake and a record yen

near the end of it · 1994-06-13 → 1995-07-03, -32.79% over the whole period

What happened that day?

  • On 3 April 1995 the Nikkei 225 fell 4.7%
  • The yen was surging into the eighties per dollar, and two weeks later reached the seventy-nines — the strongest it had ever been
  • A dearer yen raises the overseas price of Japanese goods. Volumes fall, and profits fall further
  • Part of what pushed it was the reasoning that Japanese money would return home to pay for earthquake rebuilding
  • There was also a sense that the US was content to let the dollar weaken
  • For an economy surviving on exports, it was the worst possible combination
  • In this stretch the index was 26.67% below its peak

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.