Norway's $2 trillion sovereign fund proposes deep cuts to US Treasury holdings - Reuters

The Norwegian Government Pension Fund Global, the world’s largest sovereign wealth fund, is reportedly proposing a significant reduction in its holdings of US Treasuries. According to Reuters, the fund—valued at roughly $2 trillion—has put forward a plan that, if implemented, would mark a notable shift in the allocation of one of the most influential institutional portfolios in global finance.

US Treasuries serve as the benchmark for risk-free assets and a cornerstone of central bank reserves. A reduction of this scale by a major long-term investor could carry implications for demand dynamics in the world’s deepest bond market, potentially influencing yields and the dollar’s standing. However, the proposal remains just that—a proposal. It would likely require approval from Norway’s Ministry of Finance and would be phased carefully to avoid market disruption.

For market participants, the key point is monitoring whether such a proposal moves from recommendation to policy. Any structural change in the fund’s fixed-income strategy would be a reflection of evolving risk assessments, not a sudden reaction to short-term price movements. As always, the final decision will be subject to political and economic considerations that are yet to be seen.