Nikkei 225 Tumbles on BoJ Hike Odds and US-Iran Crisis

The Nikkei 225 Index has been under pressure in recent days, falling to 65,325 after a report showed Japan's industrial production rose 3.6% YoY and retail sales increased by 4% in July.

These numbers indicate the Japanese economy is performing relatively well, which supports earnings growth.

However, most analysts now predict that the Bank of Japan will hike interest rates later this year, partly explaining why Japan bond yields have remained elevated.

The index is also reacting to the US-Iran crisis, with Brent and West Texas Intermediate oil prices rising towards $90 and $85 respectively, potentially affecting Japanese companies exposed to crude and demand risk.