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Norway cuts Hungarian govʼt bonds from pension fund benchmark

Norway will omit emerging market government bonds and corporate bonds - including government bonds of Hungary - from the fixed-income benchmark for its pension fund, the Norwegian Ministry of Finance said on Friday, Hungarian news agency MTI reported.

In addition to Hungary, sovereign issuers Chile, the Czech Republic, Israel, Malaysia, Mexico, Poland, Russia, South Korea and Thailand will be removed from the benchmark index.

The fund may still invest in emerging market government and corporate bonds, but subject to a proposed upper limit of 5%.

Data from the Government Pension Fund Global (GPFG) show the equivalent of about USD 63 million of Hungarian government and government-related bonds in the fund last year.

Norway established the GPFG in 1990 "to underpin long-term considerations when phasing petroleum revenues into the Norwegian economy." The fundʼs capital is invested abroad in equity, fixed-income markets and real estate.