August 7, 2014 / 5:02 AM / 3 years ago

Japan's GPIF to boost stock allocation to over 20 pct - sources

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TOKYO, Aug 7 (Reuters) - Japan's Government Pension Investment Fund (GPIF) plans to allocate over 20 percent of its funds to domestic stocks compared with a current 12 percent target as it aims to generate higher returns for the country's ageing population, political sources said on Thursday.

The sources familiar with the fund's plans said the GPIF will likely lower its weighting for Japanese government bonds to around 40 percent from a current 60 percent target, and may also increase investments in global stocks when it announces its new allocation plan sometime in the autumn.

Prime Minister Shinzo Abe's government has been pressing the $1.24 trillion fund, the world's largest, to shift more of its portfolio into risk assets from domestic bonds, which earn razor-thin returns. The 10-year JGB currently yields less than 0.6 percent. ($1 = 102.1700 Japanese yen) (Reporting by Takaya Yamaguchi; Writing by Ritsuko Ando; Editing by Chris Gallagher)

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