Continued increase in yen-denominated bonds, mainly super-long-term bonds, while foreign bond holdings decline: Fukoku Mutual Life Insurance Company's investment plan for the second half of FY2026

Under its general-account investment plan for the second half of FY2026, Fukoku Mutual Life Insurance plans to increase its holdings of yen-denominated public and corporate bonds. The increase will focus on ultra-long-term government bonds and corporate bonds, with an addition of approximately ¥55 billion expected in the second half. An increase of approximately ¥110 billion is expected in the first half, bringing the planned overall increase to ¥165 billion.

Foreign-currency-denominated public and corporate bond holdings are planned to decline by ¥25 billion overall. In the second half, hedged foreign-currency bonds will remain at zero, while open foreign-currency bond holdings will continue to decline. Reinvestment of maturing proceeds will be deferred, although the company will respond flexibly after assessing yen interest rates and external conditions.

For Bank of Japan policy, 2 additional rate hikes are expected during the fiscal year, with the terminal rate projected at around 1.75–2.00%. In the United States, 2 Federal Reserve rate hikes during the fiscal year are priced in; USD/JPY is expected at 150–165, with 158 projected at fiscal year-end.

Domestic and overseas equities are expected to remain flat in the second half. The portfolio will be rotated into stocks with high growth potential while realizing unrealized gains. Holdings of alternatives such as private equity will be increased, and real estate exposure will be expanded slightly.

The market outlook calls for 10-year Japanese government bond yields of 2.70%–3.50%, with 3.30% at fiscal year-end; 10-year U.S. Treasury yields of 4.50%–5.60%, with 5.40% at fiscal year-end; USD/JPY of 150–165, with 158 at fiscal year-end; the Nikkei Stock Average at ¥58,000–¥73,000; the Dow Jones Industrial Average at $47,000–$56,000; and EUR/JPY at 170–190.