Majority of fund managers feel global economy in recession

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NEW DELHI, Oct 20 (PTI): With leading world economies trying their best to infuse liquidity in their systems in the midst of worsening financial crisis, seven out of 10 fund managers believe the global economy has entered a phase of recession, says a survey.
According to Merrill Lynch's latest survey of global fund managers, about 69 per cent of the respondents believe that the global economy is in the grip of recession, which is up significantly from 44 per cent one month ago.
Similarly, the percentage of investors who believe that monetary policy is too restrictive has reached a whopping 59 per cent, it added.
The US economy, which has witnessed a drop of 0.2 per cent in growth in the third quarter this year, is forecast by economists to face another decline in the fourth quarter.
Technically, two straight quarters of negative economic growth is termed as recession.
The survey further said that low risk appetite and a belief that equities are undervalued could provide the foundation for a rally, and growing risk aversion has led to a record 49 per cent of respondents having a huge cash pile.
The number of respondents, who believe equities are undervalued, has reached a 10-year high, at 43 per cent, the survey revealed.