Level Of Dread Abating

Investors remain bearish about the global economy, but their level of dread is abating as hopes rise and inflation and interest rate shocks begin to end, says the Bank of America’s ‘August Global Fund Manager Survey.’ It found expectations of global growth were at a net negative 67 per cent in August, up from negative 79 per cent in July, which had marked a new low in the history of the survey. A net 72 per cent of survey respondents expect global profits to decline over the next month, down from a net 79 per cent in July, which was the highest mark since October 2008. Inflation tops the list as the biggest tail risk for managers at 39 per cent (up from 33 per cent in July), followed by a global recession at 24 per cent. It shows 90 per cent expect stagflation (below-trend growth and above-trend inflation).