Norway's sovereign wealth fund, the world's largest with assets of more than $2 trillion, on Thursday reported a negative return of 278 billion kroner ($31 billion) in the third quarter as it was weighed down by higher interest rates.
It posted a negative return of 0.5 percent in the quarter, dragged down by a negative return of 3.5 percent in its fixed-income investments, while its equity and property portfolios increased by 0.5 percent and 0.4 percent respectively.
"The fund's return was close to flat, ending slightly negative as rising interest rates led to weaker results on our fixed-income investments," the fund's deputy CEO Trond Grande said in a statement.
Invested primarily in equities, bonds and real estate across the globe, the fund reported a value of 22,014 billion kroner at the end of September.
Inflation around the world, fuelled in particular by soaring energy prices linked to the conflict in the Middle East, has led several central banks, including the US Federal Reserve and the European Central Bank, to raise interest rates in the third quarter.
"Equity returns were also close to zero, but there were large differences between sectors. Energy companies rose the most, while interest-rate-sensitive sectors such as utilities and real estate fell," Grande said.
Fuelled by the Nordic country's oil revenues, the fund is invested in more than 7,100 companies spanning the globe, and holds around 1.5 percent of all listed companies worldwide, making it the world's largest single investor.
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