James Baxter-Derrington (pictured), editor
November has been quite a month for the ‘what were you worried about?' crowd, which has converted the majority of Bank of America global fund manager survey respondents to their cause.
Inflation has fallen to just 3.2% in the States and on home soil, the UK managed a 2.1 percentage point fall, bringing CPI to just 4.6%, while the widely covered trio of the Fed, BoE and ECB all left rates unchanged.
Friday Briefing: The investment trust sector is having its watershed moment
Just a quarter of those surveyed believe high inflation keeping central banks hawkish is the main tail risk for markets (replaced at the top spot by geopolitical risks), while 76% are now betting the hiking cycle has run its course.
Markets have even gone so far as to predict cuts from May next year, with 48.2% betting the Fed trims, according to the CME FedWatch Tool. (There's even a 2.1% likelihood for cuts in January, which seems… I suppose it's only a small chance.)
Ask the BoE's Megan Greene when she thinks cuts are coming and you'll be met with a very different answer, as Bloomberg's Francine Lacqua found yesterday.
«Fran, I'm not thinking about cuts at the moment.»
Well, that's us told.
Hipgnosis continuation votes don't lie (feat. Wyclef Jean)
Still, the BofA respondents paid no mind and also asserted their strong belief in the ‘soft' or ‘no landing' scenario, with 74% certain things will work out just fine.
Presented (again) without comment.
Of note on the slightly less positive side, Daniel Loeb informed Third Point investors in his quarterly letter that commercial real estate was building as an opportunity — thanks to increasing default rates and loss severities, which should lead toRead more on investmentweek.co.uk