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World’s biggest pension fund posts loss in longest losing streak in two decades

Masataka Miyazono, president of the Government Pension Investment Fund (GPIF), speaks during a news conference in Tokyo, Japan, on Friday, July 1, 2022.
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Japan’s Government Pension Investment Fund — the world’s largest — reported a fourth consecutive quarterly loss on Friday, taking it to its longest losing streak in 20 years.

The world’s largest pension fund saw a 0.97% loss on its investments in the last three months of 2022, equating to 1.85 trillion yen ($14.3 billion).

The string of quarterly losses marks the pension fund’s longest stint in the red since it reported four quarters of falls for the fiscal year 2003.

The GPIF said Friday that its biggest loss was via its foreign bond holdings, which fell 5.3%, while domestic bonds investments were down 1.7%. It managed to gain 3.2% on its domestic stocks portfolio, although its investments in foreign stocks fell slightly.

It takes GPIF’s losses for the first three quarters of the fiscal year to 3.71%, or 7.32 trillion yen. It reported a 5.42% profit equating to 10 trillion yen in the 2021 fiscal year. Its total assets now total 189.9 trillion yen.

GPIF’s loss over the first three months of 2022 was its first negative quarter for two years, as it struggled with the start of U.S. interest rate rises, equity market volatility and some Russia-linked assets.

In the most recent quarter, a sharp drop in the value of the U.S. dollar

U.S. dollar against the Japanese yen

In December, the Bank of Japan unexpectedly widened its target range for 10-year Japanese government bond yields, sparking a sell-off in global bonds and stocks.

The BOJ has been an outlier among major central banks by pursuing an “extremely accommodative” expansionary monetary policy with a -0.1% interest rate.

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