The yen has risen more than 4% since the start of September, with Goldman Sachs attributing the move to a more hawkish Bank of Japan policy direction and expectations that Japan's Government Pension Investment Fund, or GPIF, could alter its asset allocation. Goldman says shifting part of GPIF's overseas holdings into Japanese fixed income could create structural support for the yen. Based on GPIF's roughly $2 trillion under management, a 5-percentage-point increase in domestic fixed-income exposure would theoretically produce about $100 billion in dollar-yen selling, equivalent to around half of Japan's annual current-account surplus, while potentially forcing the unwinding of accumulated yen-funded carry trades (borrowing yen to invest elsewhere). The impact could spread across Asian currencies. Since 2022, Goldman says the South Korean won has shown the strongest sensitivity to yen moves, with a beta of about 0.45, followed by the Thai baht and Malaysian ringgit, while the offshore yuan and New Taiwan dollar would also be affected. Goldman is particularly focused on the won: after dollar-won reached around 1,350, South Korean policy signals suggested officials may be comfortable with current exchange-rate levels, while the National Pension Service's suspension of some foreign-exchange hedging and demand for foreign-currency purchases to fund overseas investments could slow further won appreciation. Goldman continues to favor the New Taiwan dollar over the yuan in North Asia, maintaining its short offshore yuan/New Taiwan dollar position, and remains bearish on the Philippine peso while favoring the Indian rupee against the peso in South Asia. The bank says continued yen strength could produce a new round of divergence among Asian currencies, shifting foreign-exchange focus from one-way dollar moves to whether Japanese capital repatriation can materially change regional flows. Any increase in GPIF's domestic bond allocation remains a Goldman scenario rather than a formal decision.