Global institutional investors are hitting pause on U.S. assets for the first time in nearly 20 years, according to the Financial Times. Erratic trade policies and rising national debt are causing a wave of portfolio reshuffling.
Data from Bank of America's Global Fund Manager Survey shows allocations to U.S. markets at their lowest level since the late 2000s. Experts warn that uncertainty around tariffs and fiscal sustainability is shaking investor confidence.
AllianceBernstein, which oversees nearly $800 billion, flags the U.S. fiscal deficit as unsustainable, while a major private equity executive points to unpredictable tariff measures as a red flag. Investors say that building a strategy on volatility is a recipe for risk.
Across the Atlantic, Schroders has spotted early signs of capital flowing into Europe. Neuberger Berman reports that 65 percent of its private equity deals this year are now Europe-bound, up from 20 to 30 percent previously. The shift reflects caution over U.S. domestic policies and looming tax reform uncertainties.
Even Canada's CDPQ, the country's second-largest pension fund, plans to trim its 40 percent exposure to U.S. assets in a bid to spread risk more evenly.
For young investors and global citizens, this turning point signals a more multipolar market outlook. Emerging markets, sustainable tech hubs, and regional blocs could see fresh inflows as portfolios seek new growth engines.
As capital flows diversify, savvy investors will watch policy trends, debt trajectories, and trade negotiations closely. The era of American exceptionalism in portfolios might be giving way to a broader spectrum of regional powerhouses.
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Reference(s):
cgtn.com
