European investors are reducing their exposure to U.S. Treasury bonds, as a $60 billion asset management firm reevaluates its bond holdings.

More and more European institutional investors seem to be reassessing their holdings of U.S. government bonds, signaling a potential shift in market sentiment toward one of the long-standing core safe-haven assets. Concerns ranging from fiscal dynamics to tariffs and governance uncertainties are increasingly becoming topics of discussion among asset management firms and pension funds evaluating fixed income allocations.

Degroof Petercam Asset Management, a Belgian wealth management firm with approximately $60 billion in assets under management and controlled by Crédit Agricole, has not held U.S. Treasuries in its flagship sustainable government bond fund for nearly two decades. The firm stated that the exclusion was due to sustainability standards such as equality and democracy, where the U.S. scores below the threshold required by their strategy. Recently, the firm also reduced its U.S. Treasury exposure in other portfolios. Chief Sustainability Officer Ophélie Mortier said the decision was mainly driven by valuation considerations rather than sustainability concerns.

This move comes as several Nordic investors are making similar adjustments. Danish pension fund AkademikerPension previously disclosed it had exited a U.S. Treasury portfolio worth about $100 million. Europe’s largest pension fund, Stichting Pensioenfonds ABP, which manages approximately €540 billion, said last year it reduced its U.S. Treasury holdings by about €10 billion to €19 billion. Although these reallocations represent only a small part of the roughly $30 trillion U.S. Treasury market, data from Morningstar shows that European government bond funds focused on dollar-denominated strategies experienced net outflows in 2024 and 2025. This marks the first such redemption since 2013 and suggests some investors may be re-evaluating the role of U.S. sovereign debt in their global portfolios.