Elsewhere, survey respondents believe the likelihood of eurozone deflation is receding, with only 22% seeing it as high risk, down sharply from 65% last quarter. There is widespread belief that the ECB will stick to its quantitative easing (QE) programme as planned (79%), with only a minority expecting the programme to be curtailed if inflation picks up (12%).
High-yield is the most favoured asset class among 30% of those polled. The runner-up is cash (16%, level with financial institutions), indicating a certain investor exasperation with current markets.
Seventy-two per cent of respondents say financial market risk overall remains manageable and far from the red zone; 28% believe it is growing very rapidly, with leverage rising and transactions getting more aggressive, reminiscent of pre-crisis levels.
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