Global investors have changed their expectations about the global economy following Donald Trump’s election victory and now see stronger growth than before, as well as higher inflation, according to Bank of America’s monthly fund manager survey.
As a result, investors have increased their allocations to US stocks and US small caps, which are more focused on the domestic market and therefore more likely to benefit from a stronger US economy.
BofA surveyed 179 market players who have a total of $503 billion in assets under management. Of them, 22% responded after the US elections, won by former Republican President Trump.
A net 23% of respondents after the result said they expected the global economy to strengthen in the next 12 months, the most optimistic survey since August 2021.
You may be interested in: Trump does not want tariffs but he does want results in the fight against drug trafficking in Mexico: AmSoc
Investors expect more growth and inflation after Trump’s victory
This is a reversal from the October survey, which showed more respondents thought the economy would be weaker 12 months from now.
Likewise, there was a change in inflation expectations and a net 10% of post-election respondents expect higher inflation in the next 12 months, the highest percentage since July 2021.
By contrast, a net 44% of respondents surveyed in October thought the global CPI would be lower within 12 months. This percentage was reduced to 16% net in November.
Investors increased their allocations to US stocks. A net 29% overweight on US equities, the highest percentage since August 2013, according to the survey.
With information from Reuters.
Do you like photos and news? Follow us on our Instagram
