Sovereign investors shift to energy assets, question dollar's reserve role

Sovereign wealth funds and central banks managing $29 trillion in assets are shifting capital toward energy assets, a move that signals growing doubt about the durability of the U.S.-led financial order. Invesco’s latest sovereign investor survey found 80% of respondents now see energy security and energy-transition infrastructure as the most credible resilience investments, while one-third plan to raise gold holdings as they diversify away from traditional dollar exposure.

The reassessment is broadening beyond asset choice into market plumbing. Several institutions said they were reviewing their reliance on U.S.-based custodians, counterparties and clearing infrastructure as geopolitical tensions reshaped portfolio strategy. One European central bank said it had already replaced its U.S. custodian, and a Latin American central bank said it was building non-U.S. custodial relationships as a fallback. That kind of move matters because custodians and clearing networks sit at the core of cross-border investing, and any migration away from them points to a deeper concern about access, settlement risk and sanctions exposure.

The dollar question is more explicit than it was two years ago. Invesco found 61% of central banks now believe U.S. debt levels hurt the dollar’s long-term reserve-asset role, up from 20% in 2024. Invesco’s earlier study also found 72% of central banks believed U.S. fiscal dynamics were weakening the dollar’s long-term outlook, compared with 64% the year before, showing the concern had already been building before the latest survey. For sovereign investors, the issue is not simply exchange rates. It is the combination of higher U.S. borrowing, persistent inflation pressure, and a more fragmented geopolitical backdrop that makes a single reserve currency look less stable as a long-term anchor.

The shift is also helping to redraw where sovereign capital goes next. Infrastructure allocations were reported at as much as 9% of sovereign wealth fund assets in 2026, and the emphasis is increasingly on hard assets that can hold value through shocks. That includes power grids, energy transport, renewable buildout and other transition infrastructure, alongside gold. Invesco’s 2025 Global Sovereign Asset Management Study covered 141 sovereign investors managing more than $27 trillion, underscoring how large this repositioning has become across public capital. The message from those pools of money is clear: energy security is back at the center of portfolio construction, and confidence in U.S. assets is no longer being taken for granted.