The US 10-year Treasury yield, considered a global benchmark for the cost of borrowing, rose above 4.75pc for the first time since January 2025 on Monday.
On top of concerns about rising inflation, bond investors must also contend with soaring government debt levels, which topped $40tn (£30tn) in the US for the first time last month.
Nicolas Bickel, head of investment at Edmond de Rothschild, said the impact could be significant because of “the message it sends about the value of holding Treasury notes in a long-term investment portfolio”.
He added: “Inflation and fiscal policy environments have changed, and this will continue to affect long-term interest rates, which we expect to remain higher for a longer period of time.”
Kevin Thozet, a member of the investment committee at Carmignac, said Norges Bank was unlikely to rapidly sell its US Treasury bonds, and would instead run down the portfolio in stages.
He added: “The signal is strong and reflective of a deep-seated trend. For more than five years, developed sovereign bond markets (and notably in the US) have been delivering very poor returns.”