India, Aug. 31 -- Japan's benchmark Nikkei 225 came under pressure on Monday, August 31, as investors reacted to growing expectations of tighter monetary policy in Japan and renewed prospects of a US interest rate hike. The Nikkei 225 declined 1.97% to 65,096.63 in early trading, while the broader Topix fell 0.84% to 4,111.71. The decline followed losses on Wall Street last week after Federal Reserve Chair Kevin Warsh reiterated the US central bank's focus on controlling inflation.

Why Are Japan Stocks Falling?

Market expectations that the Bank of Japan (BOJ) could raise interest rates at its next meeting have strengthened. Investors are also assessing the possibility of another US rate hike following Warsh's recent comments on inflatio...