EMPIRE STRIKES BACK: Norway’s SWF Generates a Positive Equity Return for 1Q2023
Posted on 04/21/2023
In the first quarter of 2023, Norway Government Pension Fund Global returned 5.9%, equivalent to 893 billion kroner. The return on the fund’s equity investments was 7.4% . Investments in fixed income returned 2.7%, whereas unlisted real estate returned -1.0% and unlisted renewable energy infrastructure returned -3.8%. The sovereign fund’s return was 0.06 percentage point below the return on the benchmark index. Norway’s SWF was able to recover from the bond meltdowns in late 2022 when central banks globally moved to increase interest rates.
“The equity investments had the most positive contribution to the return in the quarter. The rise of the equity market was to a great extent driven by the technology and consumer discretionary sector”, says Deputy CEO at Norges Bank Investment Management, Trond Grande in a press release.
The krone depreciated against several of the main currencies during the quarter. The currency movements contributed to a considerable increase in the fund’s value of 755 billion kroner. The inflow into the fund amounted to 217 billion kroner.
The sovereign fund had a value of 14,294 billion kroner as of March 31, 2023. 70.1% of the fund was invested in equities, 27.3% in fixed income, 2.4% in unlisted real estate, and 0.1% in unlisted renewable energy infrastructure.
