14, No 5; and Arora, C. and Cerisola, M. (2001), “How Does U.S. Monetary Policy Influence Sovereign Spreads in Emerging Markets?”, IMF Staff Papers, Vol. 48, No 3, pp. 474-498. 25. Gilchrist et al. (2019), “U.S. Monetary Policy and International Bond Markets”, Journal of Money, Credit and Banking, Vol. 51, No S1, pp. 1-200; Motto, R. and Özen, K., op. cit. ; Andrade, S. C. et al. (2023), “Sovereign risk premia and global macroeconomic conditions”, Journal of Financial Economics, Vol. 147, No 1, pp. 172-197; and Eichengreen, B. and Mody, A. (1998), “What Explains Changing Spreads on Emerging-Market Debt: Fundamentals or Market Sentiment?” NBER Working Paper, No 6408. 26. See, for example, Miranda-Agrippino, S. and Rey, H. (2020), “U.S. monetary policy and the global financial cycle”, The Review of Economic Studies, Vol 87, No 6, pp. 2754-2776; and Gilchrist, S. et al. (2022), “Sovereign risk and financial risk”, Journal of International Economics, Vol. 136. 27. Gilchrist, S. and Zakrajšek, E. (2012), “Credit spreads and business cycle fluctuations”, American Economic Review, 102, No 4, pp. 1692-1720. The excess bond premium has also been shown to be a powerful driver of economic activity. See Gilchrist, S. and Mojon, B. (2016), “Credit risk in the euro area”, The Economic Journal, 128, No 608, pp. 118-158; and Bleaney, M. et al. (2016), “Bond spreads and economic activity in eight European economies”, The Economic Journal, Vol. 126, No 598, pp. 2257-2291. 28. Anderson, G. and Cesa-Bianchi, A.
Øystein Olsen: Management of the Government Pension Fund Global (GPFG) Introductory statement by Mr Øystein Olsen, Governor of the Norges Bank (Central Bank of Norway), before the Storting’s Standing Committee on Finance and Economic Affairs, Oslo, 30 April 2013. *  *  *  Please note that the text below may differ from the actual presentation. Charts in pdf I would like to thank the Chairman and thank you for giving Norges Bank the opportunity again this year to report on the management of the Government Pension Fund Global (GPFG). Chart: Changing the regional allocation The investment strategy of the GPFG builds on its specific features, purpose and our perception of the functioning of financial markets. The GPFG is a large fund and features a long investment horizon. The objective of investment management is to preserve the longterm international purchasing power of the GPFG. In 2012, the investment strategy was changed. As a result, investments in emerging markets have increased. Just over 10 percent of the overall portfolio is now invested in these markets. Chart: Increasing investments in real assets The allocation to equities was increased to 60 percent between 2007 and 2009. When the allocation to real estate reaches 5 percent further ahead, the GPFG's allocation to real assets will make up two-thirds of the overall portfolio. The long-term expected return on real assets is higher than on nominal bonds. The risk is also higher, but the long-term investment horizon puts us in a solid position to carry that risk.