Japan’s Nikkei 225 peak in December 1989 preceded the collapse of the country’s asset-price bubble.
The Nikkei 225 reached its historical closing high of 38,915.87 on December 29, 1989. During the late 1980s, Japanese stocks and land prices rose dramatically amid easy credit, speculation, and confidence in continued economic expansion.
After the peak, asset prices fell sharply. The bursting bubble contributed to banking problems, corporate deleveraging, weak demand, and a prolonged period of slow growth often called Japan’s Lost Decades. The downturn did not end immediately when the stock index first declined; its effects unfolded over many years.
The Nikkei’s 1989 peak is sometimes confused with the 1990 date commonly used for the start of the crash phase. December 1989 identifies the record high, while the larger economic consequences developed during the 1990s and beyond.