WhyItDropped

Nikkei 225 · August 31, 2010

The day the Bank of Japan acted and the yen rose anyway

-3.55%

single-day change vs previous close

Part of a longer stretch

Europe's crisis and a soaring yen

near the end of it · 2010-04-05 → 2010-08-31, -22.18% over the whole period

What happened that day?

  • The Nikkei fell 3.55% on the day — the bottom of this decline and the start of the recovery
  • The Bank of Japan had held an emergency meeting the day before and expanded its supply of funds, trying to slow the yen
  • The market judged it too small. The yen stayed in the 84-per-dollar range afterwards, its strongest in fifteen years
  • The yen was not rising because Japan was doing well. It was rising because it was where money sheltered while the US and Europe wobbled
  • With exporters' profits cut straight through by the exchange rate, the Nikkei was among the weakest major indices of that summer
  • A recovery of 23% into February of the following year began from here

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.