With growth and inflation expectations notably higher after new U.S. payroll data, the vast majority of investors in Bank of America Merrill Lynch’s November fund manager survey expect the U.S. Federal Reserve to raise rates this quarter.
Eighty-one percent of respondents said they expected a rate hike, up from 43% in October.
A total of 201 panelists with $576 billion of assets under management participated in the survey from Nov. 6 to Nov. 12.
The poll found that the percentage of asset allocators overweight equities rose by 17 percentage points from October to a net 43%, while those overweight cash fell to 4.9% from 5.1%, their lowest level since July.
Allocations to real estate rose to a 12-month high, a net 11% overweight.
In contrast, investors maintained aggressive underweights on commodities, a net 23%, and global emerging markets, net 31%.
The November survey found that investors’ confidence in the global economy had rebounded. Net expectations of its strengthening in the next 12 months were up 22 percentage points from October.