Expectations the Bank of England (BoE) and European Central Bank (ECB) will raise interest rates in the second quarter of 2011 have risen dramatically, a new survey of fund managers shows.
According to the Bank of America (BofA) Merrill Lynch monthly European Fund Manager Survey, 40% of respondents now expect the BoE to raise rates from the current level of 0.5% in Q2 2011. An equal number of managers believe a hike will come in Q3. Last month, just 17% of respondents expected a rate hike in Q2, with 31% forecasting rates to go up in Q3 and another third saying a rise was not likely until Q4. The survey, which was conducted between the 4 and 10 of March, before the earthquake in Japan, also shows a dramatic shift in expectations of a rate rise in the Eurozone. It fou...
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