Sovereign Funds Pivot to Energy Assets as Dollar Fears Rise
Invesco's survey indicates that sovereign wealth funds and central banks, which oversee $29 trillion in assets, are increasingly investing in energy and infrastructure due to geopolitical uncertainties and worries regarding the US dollar's status as a reserve currency. Among the central banks surveyed, 61% expressed that US debt levels adversely affect the dollar's long-term stability. The research, which included 90 sovereign wealth funds and 54 central banks, revealed that 80% prioritize energy security and transition infrastructure for portfolio resilience. Currently, infrastructure constitutes 9% of sovereign wealth fund assets, expected to maintain that level by 2026. Additionally, energy demands from AI infrastructure enhance this trend. Benjamin Jones, Invesco's head of research, highlighted that investors are restructuring portfolios for resilience in the face of inflation and geopolitical fragmentation.
Key facts
- Sovereign investors managing $29 trillion are pivoting to energy assets.
- 61% of central banks polled by Invesco say US debt hurts the dollar's reserve status.
- Survey covered 90 sovereign wealth funds and 54 central banks.
- 80% of respondents see energy security and transition infrastructure as credible investments.
- Infrastructure reached 9% of sovereign wealth fund assets in 2026.
- Energy-hungry AI infrastructure adds to the appeal.
- Invesco's Benjamin Jones highlighted redesigning portfolios for resilience.
- Positive bond-equity correlation has eroded reliance on bonds for diversification.
Entities
Institutions
- Invesco