Japan’s Nikkei 225 fell about 80% from its 1989 bubble peak to its later trough.
The index reached an intraday record of 38,957.44 on December 29, 1989. Japan’s property and share prices had risen dramatically during the 1980s, supported by easy credit and optimistic expectations. After the Bank of Japan tightened monetary policy, asset prices began to reverse.
The Nikkei did not collapse in a single session. Its decline unfolded over years, with the index reaching a much lower level in the early 2000s. The prolonged aftermath is associated with Japan’s “Lost Decades,” a period marked by weak growth, falling prices, banking problems, and corporate deleveraging.
The often-quoted 80% figure is a rounded description of the peak-to-trough decline, not a one-day loss. This distinguishes Japan’s drawn-out asset-bubble collapse from sudden crashes such as Black Monday in 1987.