Norway’s $2.3 trillion wealth fund proposes $106B cut to global government bonds allocation

Norway’s Government Pension Fund Global, the largest sovereign wealth fund on the planet at roughly $2.3 trillion in assets, has proposed cutting approximately $106 billion from its global government bond holdings. The bulk of that reduction would come from US Treasuries. The fund’s investment manager, Norges Bank Investment Management (NBIM), laid out the plan in a letter dated September 1, 2026, addressed to Norway’s Ministry of Finance. What the fund actually wants to do The core proposal is straightforward: reduce the government bond weighting within the fund’s bond benchmark from 70% down to 50%. That 20-percentage-point drop translates into the roughly $106 billion figure, with the freed-up capital flowing toward higher-yielding non-government fixed income like corporate bonds and mortgage-backed securities. Fixed income currently accounts for about 26% of the fund’s total portfolio. Within that slice, non-government bonds would jump from 16.2% to 27.6% of the bond index under the new framework. US Treasuries would absorb the most pain. The fund’s allocation to Treasuries within its government bond sub-index would fall from 34.1% to 21.9%. In dollar terms, that implies a pote...