Growth optimism collapses
BofA’s Hartnett survey shows global growth optimism plunged to a net 7% from 39%, while inflation expectations jumped to 45% from 9% — a huge sentiment swing in weeks ( ). Cash allocations rose to 4.3% (the biggest since COVID) even as recession odds diverge sharply across indicators — low hard‑landing odds reported alongside machine‑learning models flagging near‑term stagflation risks ( ).
BofA’s March Global Fund Manager Survey was conducted March 6–12 and canvassed 181 fund managers overseeing roughly $529 billion in assets. (bloomberg.com) The bank’s composite sentiment gauge fell to a six‑month low of 5.6 in March, down from 8.2 in February. (newcms.trustnet.com) Average cash allocations jumped to 4.3% in March from 3.4% in February, the largest monthly increase in cash since March 2020. (bloomberg.com) The survey recorded a collapse in macro sentiment — net global growth optimism slid to 7% from 39%, while the net expecting higher global inflation rose to 45% from 9%; only a net 17% of managers still expected rate cuts this year, down from 46% a month earlier. (investingmatters.com) Respondents moved their top tail risk to geopolitical conflict (driven by the Iran war), flagged private equity/private credit as the likeliest systemic credit risk, and showed the highest overweight to emerging‑market equities since February 2021. (bloomberg.com) BofA’s positioning metrics nonetheless still price a low hard‑landing probability (around 5%), even as analysts and machine‑learning‑based inflation‑forecasting research and commentary have recently highlighted elevated near‑term stagflation risks. (investingmatters.com)
