4 Dec 2013
Japan’s GPIF can lower JGB weighting without selling bonds immediately
FXstreet.com (Łódź) - Takahiro Mitani, the head of Japan's Government Pension Investment Fund admitted on Wednesday that the fund´s JGB holdings were too big but that their weighting could be reduced to the recommended 52% level by allowing the bonds to mature instead of byselling them.
The projected 5.8 trillion yen in pension payouts in 2014 and 2015 would come from JGB redemptions and interest and would lower the domestic bonds' weighting.
“If we know that this will happen, then why do we need to shake up the market now by selling?” Takahiro Mitani said. He also expressed interest in buying inflation-linked JGBs as an inflation hedge as well as foreign bonds.
Japan's GPIF is the world's largest public pension fund and financial markets remain sensitive to its actions.
The projected 5.8 trillion yen in pension payouts in 2014 and 2015 would come from JGB redemptions and interest and would lower the domestic bonds' weighting.
“If we know that this will happen, then why do we need to shake up the market now by selling?” Takahiro Mitani said. He also expressed interest in buying inflation-linked JGBs as an inflation hedge as well as foreign bonds.
Japan's GPIF is the world's largest public pension fund and financial markets remain sensitive to its actions.