National Pension Service Posts 0.37% Fund Return in May...First Positive Turn Since COVID-19

[Asia Economy Reporter Ji-hwan Park] The National Pension Fund's rate of return, which had recorded negative figures due to the global spread of the novel coronavirus infection (COVID-19), has turned positive.

The National Pension Service Fund Management Headquarters announced on the 30th that the rate of return on the National Pension Fund as of the end of May this year was tentatively calculated at 0.37%. The National Pension's rate of return had been negative until April. The rate of return started at 0.6% in January, then recorded -0.45% in February when COVID-19 began to spread, -6.08% in March, and -2.57% in April.

By asset class, the weighted return based on amount showed overseas bonds and domestic bonds with returns of 10.59% and 2.27%, respectively. Domestic stocks and overseas stocks were recorded at -6.18% and -2.63%, respectively.

The domestic and foreign bond asset classes were affected by the decline in interest rates as major domestic and global countries implemented accommodative monetary policies such as lowering benchmark interest rates and purchasing bonds to overcome COVID-19. As interest rates fell, bond valuation gains increased, and foreign currency translation gains also rose due to the increase in the won-dollar exchange rate.

However, domestic and overseas stocks saw a decline in returns due to concerns over prolonged economic recession and U.S.-China conflicts related to the Hong Kong security law.

Since its establishment, the National Pension Fund's average annual cumulative return has been 5.29%, with cumulative earnings totaling 370.2 trillion won.

This content was produced with the assistance of AI translation services.