World’s Biggest Sovereign Wealth Fund Plans to Cut U.S. Treasury Holdings

Norway’s $2.3 trillion sovereign wealth fund has proposed cutting government bonds in its benchmark portfolio from 70% to 50%, with U.S. Treasuries expected to bear the largest reduction. The fund’s Treasury allocation could fall from 34.1% to 21.9% of government bond holdings, a reduction estimated at nearly $80 billion. Managers say the shift would preserve liquidity while increasing exposure to corporate bonds and mortgage-backed securities. The proposal is not final and requires approval from Norway’s finance ministry and parliament eventually.