Honestly,I would be offended. Good work is demonstrated by output. Having the feeling of someone looking over your shoulder is a statement of a lack of trust and confidence. I can't speak for you or your situation, but I would openly communicate this and try to find a solution that is mutually beneficial. Maybe your manager is concerned about the level of output, which can be measured in different less intrusive ways. Try to identify his motivation and find a solution that works for both parties.