Pension industry leaders and investment chiefs from Finland, Sweden and Denmark told Reuters they viewed U.S. foreign policy uncertainty and White House debt levels as a threat to the dollar, U.S. Treasuries and stocks. The Nordic region is home to some of Europe’s biggest pension funds by assets.
This week two Nordic pension funds, Sweden’s Alecta and Denmark’s AkademikerPension, said they had sold or were in the process of selling their U.S. Treasuries.
While they said the decisions were unrelated to recent events, U.S. President Donald Trump’s ambitions for Greenland have revived speculation about Europe responding with financial protectionism to his administration’s policies.
“We’re having a lot of discussions (with clients) around (whether) it is time to tilt away from U.S. assets,” said Van Luu, global head of solutions strategy, fixed income and foreign exchange at Russell Investments, which advises retirement schemes.
“About 50% of them are considering whether they should do something about it,” especially Northern European clients, including in Scandinavia and the Netherlands, he said.Seattle-based Russell advises clients with $1.6 trillion of assets and manages $636 billion directly.
The value of the U.S. Treasuries held by Dutch pension fund ABP, Europe’s largest, dropped steeply from the end of 2024 to September last year, likely driven by a reduction in holdings.
Makes sense. I wouldn’t invest in a place like that either.
USA is sliding into lawless chaos, much like most of Africa already has. Would you invest in Sudan or Congo? No you wouldn’t. Who knows what the local dictator decides to do with your assets. If you own a company there, who knows what will happen to your employees. If laws don’t matter, there’s no predictability or certainty. When there’s uncertainty, investors see that as elevated risk.
Many investors also have ethical requirements (ESG), so investing in war, gambling and porn is usually out the question. This also applies to governments involved in human rights violations, such as USA.