Asia Market Wrap 18 September: Japan Raises to Its Highest Rate Since 1995 and the Yen Falls Anyway
The Bank of Japan raised and the yen fell anyway. The Nikkei 225 closed 1.38 percent higher at 65,018.95 on Friday after the Bank lifted its policy rate a quarter point to around 1.25 percent, its highest since 1995 on the network’s account, and the yen still weakened 1.24 percent to 157.90 to the dollar at our capture, while South Korea’s Kospi led the board at 2.66 percent higher. Brent crude traded at 103.21 dollars a barrel at our 10:20 GMT capture, 1.54 percent below Thursday’s settlement, a third session lower against our published settlements.
A hike, a split vote, and a currency that would not turn
The decision itself landed as surveyed. The policy board voted 7 to 2 to take the uncollateralized overnight call rate to around 1.25 percent from 24 September, with Asada and Sato dissenting, per the Bank’s statement, which says the risk to prices is that underlying inflation deviates upward beyond the 2 percent target; the basic loan rate moves to 1.5 percent. The rise quickens the cycle, coming 3 months after the last one against the 6 month spacing the normalization had kept, and about 90 percent of economists in the network’s survey expected it, with the dissenters also correctly picked. The August inflation print was softer on the standard measures: the headline rate held at 1.9 percent, with core inflation at 1.7 percent against the 1.8 expected, per the same report. And still the yen fell through the decision, to 157.90 at our capture, on a day the report frames against a historically weak currency and the earlier coordinated Tokyo and Washington intervention to prop it up.
Seoul and Taipei lead as Tokyo splits from its broad gauge
The strongest gains sat in Seoul, Taipei and Shenzhen. The Kospi rose 2.66 percent to 6,894.23, the day’s best, with the Taiex up 1.93 percent to 47,180.75 and Shenzhen 1.72 percent to 13,640.87, while Shanghai added 0.94 percent to 3,911.87 and the Hang Seng 0.60 percent to 24,750.78. Tokyo split in two: the Nikkei rose 1.38 percent while the broad Topix slipped 0.07 percent to 4,091.14, a narrow advance rather than a broad Tokyo rally, on our reading. India’s Nifty 50 added 0.33 percent to 23,346.40, Australia’s board closed 0.01 percent lower and Singapore’s Straits Times eased 0.08 percent. On the standing block, silver rose 2.18 percent to 67.54 dollars an ounce with gold up 0.44 percent at 4,419.00, and the crude legs fell, Brent 1.54 percent and WTI 0.57 percent below Thursday’s settlements, as supply hopes outweighed fresh strikes between Saudi Arabia and the Houthis, per the same report.
Top gainers
| Index | Close | Change |
|---|---|---|
| Kospi (South Korea) | 6,894.23 | +2.66% |
| Taiex (Taiwan) | 47,180.75 | +1.93% |
| Shenzhen Component (China) | 13,640.87 | +1.72% |
| Nikkei 225 (Japan) | 65,018.95 | +1.38% |
| Shanghai Composite (China) | 3,911.87 | +0.94% |
| Hang Seng (Hong Kong) | 24,750.78 | +0.60% |
| Nifty 50 (India) | 23,346.40 | +0.33% |
Top gainers, closes of Friday 18 September 2026 from the vendor’s feed, all sessions ended before our 10:20 GMT capture, ranked by change; every change reconciles against our published 17 September closes.
Top losers
| Index | Close | Change |
|---|---|---|
| S&P/ASX 200 (Australia) | 8,731.20 | -0.01% |
| Topix (Japan) | 4,091.14 | -0.07% |
| Straits Times (Singapore) | 5,656.11 | -0.08% |
Top losers, same session and basis.
Commodities and currencies
| Instrument | Level | Change |
|---|---|---|
| Gold, COMEX (Dec’26), dollars an ounce | 4,419.00 | +0.44% |
| Silver, COMEX (Dec’26), dollars an ounce | 67.54 | +2.18% |
| Brent Crude, ICE (Nov’26), dollars a barrel | 103.21 | -1.54% |
| WTI Crude, NYMEX (Oct’26), dollars a barrel | 101.33 | -0.57% |
| US Dollar Index (DXY) | 100.354 | +0.11% |
| Euro/Dollar | 1.1484 | +0.09% |
| Sterling/Dollar | 1.3367 | +0.09% |
| Dollar/Yen | 157.90 | +1.24% |
Intraday quotes captured at 10:20 GMT in a single call, fixed row order; the 4 commodity rows are measured against Thursday’s settlements as carried in the price feed, settlement to snapshot, and the currency rows are on the vendor’s daily basis.
Why it matters: the market treated Japan’s rate rise as a currency event it had already paid for, on our reading: a 7 to 2 vote the survey had priced, a yen that fell through the decision, and a Nikkei advance the broad Topix did not join says the trade is the currency, not the rate, and a quickening cycle that cannot yet turn the yen leaves the pressure where it was. On our board, the Kospi led at 2.66 percent and the Straits Times lagged, 0.08 percent lower.
Outlook: Our Middle East wrap pauses for the weekend and returns Sunday; Europe trades into the close with the ECB’s president telling Irish radio she will leave the bank in 2027 and will not rule out further rises, per the same report, and our Europe wrap follows tonight; the commodities wrap takes tonight’s settlements.
Sources: Bank of Japan, CNBC, The Edge.
