Global Funds Raise Eurozone Assets

Global investors have raised their holdings of eurozone equities and bonds to the highest levels in more than two years, a Reuters poll showed, reflecting a conviction that the European Central Bank will not rush to raise interest rates. Investors have sought signals as to when the ECB will start reducing its asset-purchase scheme, but the bank left its ultra-easy monetary policy unchanged at its July meeting and did not even discuss winding down stimulus. That probably gave fresh impetus to investor bullishness on Europe. Reuters’ monthly asset allocation survey of 49 fund managers and chief investment officers in Europe, the United States, Britain and Japan, showed assets from the single currency bloc continued to be favored. The poll, conducted between July 17-26, showed funds boosting eurozone equity allocations to an average 20.1%, the highest level since April 2015 and up 3.4 percentage points since the start of the year. They also raised eurozone bond holdings by two percentage points to 29.2%, the highest since March 2015.