SINGAPORE (Reuters) – Singapore’s Temasek Holdings reported the smallest rise in its portfolio value in three years as declines in key bank stock holdings weighed, and the state investor said it had tempered its pace of investments.

Like larger sovereign wealth fund GIC, Temasek cited the U.S.-China trade war and a low interest rate environment as factors that would lower return expectations for the longer term.

“Trade and technology tensions are already disrupting supply chains, business confidence is being tested, capital investments have slowed,” Png Chin Yee, a senior managing director at Temasek, told reporters on Tuesday.

“If growth remains weak, the low interest rate environment is likely to persist, this could lower returns expectations into the foreseeable future,” she said.

Washington and Beijing have slapped tariffs on billions of dollars of each other’s imports, stoking worries that the nearly year-long trade war would escalate. Those tariffs remain in place while negotiations resume.

Temasek’s 1.6% portfolio gain for the year to March 31, 2019 came after a 12% increase a year ago and took its net portfolio value to a record S$313 billion ($230 billion).

MSCI’s Asia shares ex-Japan index and Singapore’s main index fell about 6 percent in the past year.

Reflecting its cautious stance, Temasek’s divestments of S$28 billion outpaced its investments of S$24 billion in the past year.

($1 = 1.3600 Singapore dollars)