Despite trade war uncertainty, global growth pessimism is fading, according to the latest European Fund Manager Survey from Bank of America.
A net 46% of survey participants think that the global economy is set to weaken over the coming year, down from 59% last month and a record 82% in April, on the back of “a fading tariff threat”, BofA reports.
A soft landing for the global economy is once more becoming consensus, with 66% of investors believing this is the most likely outcome, up from 37% in April.
Investors regard a strong US consumer as the biggest upside risk for global growth, while the Trump policy mix is seen as the largest downside risk.
A trade war that triggers a global recession is considered the biggest tail-risk by around half of the respondents and close to two-thirds think only very little of the tariff shock is already in the price, BofA adds.
