Why Nikkei 225 (JP225) fell 1.11%
Nikkei 225 (JP225) fell 1.11% on July 31, 2026 — Nikkei slides on BOJ hold, weaker yen.
What happened
The Bank of Japan held rates steady while market conviction in sustained yen intervention faded, prompting a broad Japan (Yen & Equities) selloff across both currency and equity markets.
Why it moved
BOJ's inaction signals no near-term hawkish pivot, undermining the carry-trade unwind that had supported yen strength — equities suffer as the currency weakens and imported inflation expectations rise, pressuring real…
Why it matters
Japan's macro policy stance remains in flux between domestic inflation (July CPI +1.9% vs +1.7% expected) and currency stability; equities are caught between BOJ dovishness and yen fragility, a structural drag on the…
What would break the thesis
If BOJ signals a rate hike or renewed intervention intensity at the next meeting, yen stability could restore, pulling equities back up; absence of either would deepen the selloff.