On August 5, global markets were falling. US stock indices were down 2-4% by the evening, precious metals were down 1% to 4%, Brent oil futures fell from $80 to $76 per barrel, and Bitcoin lost 18% of its value in a day.
The problems were especially severe in Japan: the Nikkei 225 stock index fell by more than 12%. For Nikkei, this is the worst decline since Black Monday on October 19, 1987, when it fell by 14.9%. The Russian market followed global trends and fell by almost 2.5%.
The reason for such movements were two macroeconomic events. On July 31, the Central Bank of Japan raised the rate from 0.1% to 0.25% amid slightly elevated inflation — it remains at 2.8%, that is, above the target level of 2%. The second event was the announcement of fresh statistics on the US labor market on August 2 – the number of newly created jobs unexpectedly turned out to be significantly lower than the consensus forecast – 114,000 against 175,000, and unemployment reached 4.3%, while the market expected 4.1%. Probably, the mood of players was influenced by tensions in the Middle East and Bangladesh, but these factors were hardly key.