Investor confidence is on the rise, buoyed by expectations of interest rate cuts by the US Federal Reserve in 2024, which has eased concerns about a severe global economic downturn. The latest survey by BofA Securities reveals a significant shift in sentiment: 79% of investors now foresee either a 'soft' or 'no' landing for the global economy in 2024, marking a nine-month peak in optimism.
A 'soft landing' implies a deceleration from growth to slower growth or stagnation, steering clear of recession. In contrast, only 17% anticipate a 'hard landing', characterized by a marked economic slowdown, registering a nine-month low in such expectations, said the January survey report.
The outlook for global growth is also looking up, with 41% of survey respondents not expecting any recession in 2024. Additionally, there's a notable uptick in profit expectations, reaching a two-year high.
The survey found that a net -21% of Fund Manager Survey investors expect a rise in global profits over the next 12 months, the most optimistic stance since February 2022. This shift in investor mood aligns with the recent uptrend in global equities, underscoring a more positive economic outlook.
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