Nordic Giants Dump Treasuries, Cut U.S. Exposure as Geopolitical Fears Drive Flight to Gold
New York – Some of Northern Europe’s largest institutional investors are rethinking how much risk they are willing to take in the United States, shifting money out of U.S. government debt as geopolitical tensions rise and gold surges to record highs.
Pension chiefs and advisers from Sweden, Denmark and Finland told Reuters they are reassessing their long-term allocations to U.S. assets amid mounting concern over Washington’s foreign policy unpredictability and deteriorating public finances.
At the same time, investors are flocking to traditional havens. Spot gold has climbed more than 11% so far this year, touching an all‑time high near $4,900 an ounce, after a blistering 64% rally in 2025. On Wednesday, Goldman Sachs raised its end‑2026 gold price forecast to $5,400 per ounce from $4,900, citing diversification by private investors and emerging‑market central banks.
“We’re having a lot of discussions with clients about whether it is time to tilt away from U.S. assets,” said Van Luu, global head of solutions strategy for fixed income and foreign exchange at Russell Investments, which advises retirement schemes overseeing $1.6 trillion. “About 50% of them are considering whether they should do something about it,” he added, highlighting particularly strong interest in Scandinavia and the Netherlands.
Treasuries Under Scrutiny, Gold in Demand
Two Nordic pension funds have already acted on these concerns. Alecta, Sweden’s largest private pension provider, has sold most of its U.S. Treasury holdings since early 2025, offloading an estimated $7.7 billion to $8.8 billion, according to local media. Denmark’s AkademikerPension is in the process of exiting roughly $100 million in Treasuries and expects to be fully out by February 1.
Both funds pointed primarily to U.S. fiscal risks – including a budget deficit near $1.8 trillion and high refinancing costs – rather than making an explicit political statement. But their decisions come as President Donald Trump’s aggressive push to take control of Greenland has triggered a sell‑off in U.S. assets and heightened transatlantic tensions.
“This is connected to the decreased predictability of U.S. policy in combination with large budget deficits and a growing national debt,” said Alecta Chief Investment Officer Pablo Bernengo, describing a “staged approach” to scaling back U.S. bond exposure.
AkademikerPension’s investment chief Anders Schelde cited “poor U.S. government finances” and said the fund had found alternative ways to manage liquidity and risk. While the move was “not directly related” to the Greenland dispute, he acknowledged that the political backdrop made the decision easier.
As some Nordic funds retreat from Treasuries, they and other investors are leaning more heavily into gold. Goldman Sachs said in a note that private-sector buyers hedging “global policy risks” had driven an upside surprise in prices and were unlikely to liquidate holdings in 2026. The bank expects central bank net purchases to average 60 tonnes next year as emerging markets continue to diversify reserves into bullion.
Commerzbank last week lifted its own gold target to $4,900 by year‑end, also citing safe‑haven demand.
From Trade Tensions to Capital Flight Fears
Trump’s threats of steep tariffs on European allies and earlier refusal to rule out the use of force to secure Greenland jolted markets this week. The S&P 500 suffered its worst one‑day fall since October, the dollar weakened, long‑dated Treasury yields jumped and gold raced to new highs as investors piled into perceived havens.
Bridgewater Associates founder Ray Dalio warned that escalating frictions risk spilling over from trade to cross‑border capital flows. “On the other side of trade, deficits and trade wars, there are capital and capital wars,” he told CNBC in Davos, suggesting sovereign and pension investors may become less willing to finance U.S. deficits if they no longer see Washington as a stable partner.
European institutions collectively hold about $8 trillion in U.S. stocks and bonds, according to Deutsche Bank. The recent Nordic divestments represent only a sliver of that, but their symbolic importance is considerable: conservative, long‑horizon investors are now publicly questioning the risk‑return profile of U.S. government debt and turning more visibly toward gold.
Unusually Public Reassessment
What stands out is not only the portfolio shifts but also the openness of the debate. Pension funds typically avoid linking investment decisions to current affairs, preferring to look through short‑term turbulence. This time, they are speaking out.
“All of this turmoil is raising some questions about how exposed you should be to the U.S.,” said Tom Vile Jensen, deputy director of Insurance and Pensions Denmark. “That is what our members are professionally assessing.”
For now, the United States remains central to global portfolios: its economy is growing strongly and its markets remain the deepest in the world. But with gold near record levels and Wall Street’s traditional long‑only buyers starting to hedge more visibly, the long‑assumed safety premium on U.S. assets is being quietly – and, in parts of Northern Europe, quite publicly – repriced.
