Japan’s Nikkei 225 peaked in 1989 before the country’s early-1990s crash.
The index reached an all-time closing high of 38,915.87 on December 29, 1989. That peak came during Japan’s asset-price bubble, when rapidly rising land and equity prices were supported by easy credit, optimistic expectations, and aggressive lending by financial institutions.
After the Bank of Japan tightened monetary policy and property prices began falling, the Nikkei dropped sharply in 1990 and continued weakening over subsequent years. The bursting of the bubble damaged banks and corporations, reduced investment, and contributed to Japan’s prolonged economic stagnation, often called the “Lost Decades.”
A common mistake is to call 1990 the peak because most of the dramatic decline occurred then. The precise record high, however, was reached at the end of 1989. The Nikkei’s fall was part of a broader asset collapse involving commercial land, residential property, and heavily leveraged borrowers.