The world’s largest sovereign wealth fund is warning markets of the dangers of tariff-fuelled inflation
Nicolai Tangen, chief executive officer of Norges Bank Investment Management, during a news conference in Oslo, Norway, Tuesday, Jan. 30, 2024. Norway’s $1.6 trillion wealth fund increased its bets on top technology companies last year after interest in artificial intelligence has led to growth in the sector.
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Tariff-driven inflation is one of the biggest market risks in 2025, Nicolai Tangen, head of the world’s largest sovereign wealth fund, said on Tuesday.
“I don’t think I should give any advice to the US, but if you look at the risk to the financial markets, I think inflation is certainly one of them, all fueled by tariffs,” Norges Bank Investment Management’s chief executive told CNBC at the World Economic Forum in Davos.
“Many of the proposals coming out of the U.S. now are potentially inflationary. They could cause even more inflation. There could be less labor supply, there could be more tariffs — all those things are inflationary, so there’s no guarantee that inflation will come down,” he said.
Tangen also flagged additional major risks that include higher interest rates for longer, high levels of government debt and geopolitical tensions. He cited the concentration of US stocks among large technology companies as the biggest risk, which he said had “never been bigger”.
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