Central bank and sovereign wealth fund assets will shrink by $1.2 trillion, or almost 7 percent, by the end of the year as China and petrostates including Russia and Saudi Arabia dip into their savings amid slower growth and lower crude revenues, according to UBS Group AG. The decline will be driven by China withdrawing its foreign exchange reserves, while oil-producing countries tap foreign assets to support government spending, Massimiliano Castelli, head of global strategy at UBS Asset Management, said in a phone interview from Zurich Tuesday. The fall in sovereign assets will likely continue into next year and also be driven by an expected drop in investment returns, he said. Assets held by central banks and sovereign wealth funds amounted to more than $18 trillion at the end of 2014, according to UBS. Sovereign wealth funds from Oslo to Riyadh and Doha to Moscow are preparing to withdraw […]