Norges Bank reports increase in foreign exchange reserves in Q1 2023

Norges Bank’s foreign exchange reserves increased by NOK 99.0bn in the first quarter of 2023, resulting in a market value of NOK 713.4bn. The bank’s aim for managing the foreign exchange reserves is to achieve the highest possible return within applicable risk limits. The reserves are divided into an equity portfolio, a fixed income portfolio, and a petroleum buffer portfolio. The fixed income portfolio’s benchmark index is a market-weighted index of nominal government bonds issued by six countries, while the equity portfolio’s benchmark index is a tax-adjusted global equity index. The market value of the fixed income investments and equity investments was NOK 514.8bn and NOK 127.3bn, respectively. The return on equity investments was 8.1%, while the return on fixed income investments was 1.7% in international currency terms. The strategic equity allocation of the total equity and fixed income portfolio is 20%. The petroleum buffer portfolio is invested in short-term fixed income instruments, and no benchmark index has been set for this portfolio. The size and liquidity of the foreign exchange reserves are considered sufficient for meeting the bank’s commitments.