Japanese government bond yields jumped, with the 10-year JGB yield briefly
approaching 3%, near a 30-year high. The move helped drive GPIF to its seventh
consecutive quarterly loss on domestic bond holdings through April–June. GPIF's
current domestic bond target is 25%. Analysts say the yield rise may have pushed
expected returns to levels that justify raising that target. Dai-ichi Life
Research Institute executive researcher Koji Okuda said GPIF could consider
lifting domestic bond allocation to 30–35% after assessing expected returns and
risks across scenarios. GPIF managed about ¥318 trillion (~$2 trillion) at
end-June; a one percentage-point change in allocation would imply over ¥3
trillions of flows.
