The world’s largest pension fund reported the longest period of losses in 20 years
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Japan’s Government Pension Fund (GPIF), the largest in the world by assets, has published its report for the third financial quarter of 2022. GPIF assets decreased by 1%, or 1.85 trillion yen ($14 billion), reaching $189.9 trillion yen ($1.48 trillion), writes Bloomberg.
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According to Bloomberg, the fund reported quarterly losses for the fourth time in a row. During this time, he lost more than $71 billion.
GPIF is experiencing the longest period of losses in the last 20 years of its operation. The pension fund last recorded losses for four consecutive quarters in the 2002 financial year (ended in March 2003).
Read: Norway’s largest sovereign wealth fund in the world lost $164 billion due to inflation
GPIF assets are evenly distributed across four categories and include Japanese and foreign stocks and bonds. The share of Japanese stocks in the fund’s portfolio increased by 3.2%, while domestic debt obligations decreased by 1.7%. The value of foreign shares decreased by 0.05%, and bonds – by 5.3%.
According to Bloomberg, one of the reasons for the decrease in the volume of the GPIF portfolio was the weakening of the US dollar against the yen – at the end of 2022, the biggest drop since 2008 was recorded.
This led to a decrease in the value of foreign assets, which make up about half of all assets of the fund. At the same time, it became unprofitable to hold Japanese government bonds — in December, the Bank of Japan sharply revised its yield curve containment policy.
Source: Ministry of Finance
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