Asian shares mostly dip as the yen rises against the U.S. dollar

January 26, 2026 - 13:04

Asian stock markets opened the week mostly lower, with Japan's benchmark index leading the decline following a sharp rise in the value of the yen against the U.S. dollar. The currency's strength pressured major export-oriented companies, which see their competitiveness and overseas profits diminished when the yen appreciates.

Japan's Nikkei 225 fell notably, shedding 1.9% to close at 52,812.45. The sell-off was broad among major exporters, with industry giant Toyota Motor Corp. seeing its shares drop 3.2%. A weaker yen typically boosts the value of Japanese exporters' foreign revenue when converted back to the local currency, making the yen's current strength a headwind for corporate earnings outlooks.

The shift in currency markets prompted investors across the region to exercise caution. While other Asian markets saw more modest movements, the overall tone was subdued as traders assessed the implications of the yen's rally. Market analysts suggest the move reflects shifting expectations regarding the monetary policy divergence between the U.S. Federal Reserve and the Bank of Japan, influencing capital flows and equity valuations. The focus now turns to upcoming economic data and central bank commentary for further direction.