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Japan to Pass China as America’s Largest Creditor, Nomura Says

Japan is poised to pass China as America’s biggest foreign creditor this year with help from the world’s largest pension fund, according to Nomura Holdings Inc.

The 126.6 trillion yen ($1.25 trillion) Government Pension Investment Fund will increase overseas bond holdings in coming months to earn higher yields, according to money managers, strategists and economists surveyed by Bloomberg. Separate funds in Japan that use GPIF’s allocations as a benchmark may follow, according to a professor who advises the government. China’s accumulation of reserves that it has used to buy Treasuries will diminish, a Beijing-based official said last month.