Japan’s Govt Pension Investment Fund posts US$61b quarterly loss as weak dollar hits assets.

Japan’s Government Pension Investment Fund (GPIF) suffered a quarterly loss as a depreciating dollar dragged down the value of its overseas securities and domestic assets slumped. 

The GPIF, one of the world’s largest state pension funds, lost ¥8.815 trillion (US$61.1 billion or RM257.8 billion) in the January-March period, with assets totalling ¥249.8 trillion, it said in Tokyo on Friday. On an annual basis, the fund had a 0.7% return.

The quarterly loss came as the rumblings of a global trade war due to higher US tariffs hurt equities and the outlook for interest-rate cuts dragged down the dollar against the yen. The GPIF incurred losses on all four of its assets classes for the first time since July to September of 2022. 

Overseas investments slumped 6% for stocks and 2% for bonds during the quarter. Japanese stocks dropped 3.5%, while domestic debt slid 2.2%. 

During the quarter, the MSCI All-Country World Index of global stocks fell 1.7% and the S&P 500 dropped 4.6% as the Topix lost 4.5%. Yields on 10-year Treasuries dropped more than 30 basis points, while benchmark Japanese bond yields climbed around 40 basis points. The dollar fell 4.6% against the yen.

Source: theedgemalaysia