TOKYO :Japan’s Government Pension Investment Fund (GPIF) will retain its existing portfolio composition, an equal split between domestic stocks and bonds, and foreign stocks and bonds in 2025 and beyond, it said on Monday.
It raised its investment return target to 1.9 per cent from 1.7 per cent above nominal wage increase. The 1.7 per cent target had been in place since April 2015.
The announcement dispels speculation that the fund would increase its allocation to stocks that built up after the government last December proposed raising the investment return target to 1.9 per cent from 1.7 per cent.
The GPIF’s movements are closely watched by markets as it is one of the world’s largest institutional investors with 258 trillion yen ($1.73 trillion) in total assets as of the end of December 2024.
Since its inception in 2001 to the end of the 2023 financial year, the fund has made an average annual actual rate of return of 4.24 per cent.
At its last review in 2020 the GPIF raised its allocation of foreign bonds to 25 per cent from 15 per cent and cut its allocation of domestic bonds to 25 per cent from 35 per cent.
($1 = 148.9000 yen)