As President Joseph Biden settles into the White House, 26% of fund managers surveyed in January by Bank of America Global Research say his main focus in the first 100 days will be on health care, while 25% cite infrastructure, 19% inequality and 11% environment.
Asked what Biden’s most likely policy response to reduce the debt burden will be, 34% believe it will be higher taxes, 26% inflation and 23% Modern Monetary Theory.
The survey was conducted Jan. 8 to Jan. 14 among 217 investors with $596 billion in assets under management.
Global Economic Growth
Nine in 10 global fund managers expect the global economy to grow over the next 12 months, the third highest growth expectations on record. Fifty-nine percent say the global economy will get “a lot stronger,” up three percentage points from the December survey.
Net 87% of investors in the survey expect global profits to improve over the next 12 months, the best outlook on profits since February 2002, BofA said.
A record net 83% of respondents anticipate a steeper yield curve — higher than 2008 Lehman bankruptcy, the Federal Reserve’s 2013 “taper tantrum” and the 2016 U.S. presidential election, according to BofA.
Expectations of higher inflation in the next 12 months also set a record in January, cited by 92% of fund managers.
BofA noted that the “Goldilocks” consensus has peaked, as only 41% of investors still hope for higher growth and lower inflation in January, down from 47% in November.