Japan to press GPIF on domestic assets as JGB selloff exposes BOJ independence fears

Japan’s government is signaling it may encourage the $1.81 trillion GPIF and other pension funds to increase domestic asset allocations as rising JGB yields expose concerns about fiscal expansion and possible political interference in BOJ policy. Officials repeatedly denied meddling, saying rate decisions remain solely the BOJ’s responsibility, while also confirming a revision of the economic blueprint after draft language sparked worries by emphasizing policy guidance toward stronger growth without explicitly stressing BOJ independence. The story is market-relevant because any shift by GPIF could affect Japanese bonds, the yen, and domestic equities, while the blueprint revision may determine whether JGB yields stabilize or remain under pressure.