A possible worldwide recession is the biggest concern among European credit investors, according to a survey conducted by Bank of America Merrill Lynch (BoA). Nearly 30% of those polled said the economy struggling globally was their biggest worry, ahead of China or inflation growing, marking the most significant agreement over a single threat since June 2017. Despite recession concerns, BoA said European investors are continuing to add corporate hybrids, insurance and subordinated bank debt, as well as defensive positions in utilities. It has resulted in cash allocations going down to 3.5%, leaving most fund managers wary spreads are too tight.
A possible worldwide recession is the biggest concern among European credit investors, according to a survey conducted by Bank of America Merrill Lynch (BoA). Nearly 30% of those polled said the economy struggling globally was their biggest worry, ahead of Brexit or inflation growing, marking the most significant agreement over a single threat since June 2017. Despite recession concerns, BoA said European investors are continuing to add corporate hybrids, insurance and subordinated bank debt, as well as defensive positions in utilities. It has resulted in cash allocations going down to 3.5%, leaving most fund managers wary spreads are too tight.