LONDON (Reuters) – A survey of almost 200 global fund managers by BofA has shown a record surge in global growth expectations over the last two months has drastically cut recession worries.
The December installment of the poll revealed that 20% of money managers now think the world economy will experience above-trend growth and below-trend inflation next year — the so-called ‘goldilocks’ scenario.
Allocation to global equities jumped 10 percentage points month-on-month to a net 31% overweight which is the highest level in a year, while their cash levels — a gauge of risk aversion — are the lowest since March 2013 at 4.2%.
The BofA survey showed the most ‘crowded’ trades were currently: #1 long U.S. tech & growth stocks, #2 long U.S. Treasuries and #3 long investment grade corporate bonds.
(Reporting by Marc Jones; Editing by Tom Arnold)