https://resources.german.lsa.umich.edu/schreiben/umlaute/ https://www.novalutions.de/en/how-to-type-an-umlaut-in-micro... https://www.process.st/how-to/type-an-umlaut-in-microsoft-wo...
and IIRC something similar worked for Ctrl-' + e = é , Ctrl-` + a = à, Ctrl-~ + n = ñ, and so on.
So there's at least some association for (punctuation mark) + (vowel) = marked vowel and I could see people dropping the Control key and doing what's done here.
Windows however does offer a "English (international with dead keys)" keyboard layout that turns :, `, ^, etc into dead keys. Word offering the same at another level of abstraction sounds like a typical Microsoft thing
(Itś pretty annoying to write with if youŕe typing english, I can recommend toggling the keyboard layout (Alt+Shift in Windows by default) whenever you switch languages)