GPIF Shifts Strategy with Active Domestic Bond Managers

Japan's Government Pension Investment Fund (GPIF) has made significant changes to its investment strategy, hiring active domestic bond managers for the first time in five years.

The move is aimed at improving expertise and diversifying risk assets amidst heightened volatility in Japan's debt market. GPIF has appointed three firms - Asset Management One, Mitsubishi UFJ Trust & Banking, and Sumitomo Mitsui Trust Asset Management - to manage Japanese bonds.

The domestic bond portfolio of GPIF has suffered losses despite strong overall returns. The portfolio lost 5.1% in the year ended March 31, even as total assets returned 16.5%. Officials are urging GPIF to invest more in domestic assets, which is expected to provide support for the Japanese Yen (JPY) over time.