Investor confidence is back on the up as economists and investors predict that the worst of the inflationary period is behind us, according to the latest HL Investor Confidence Index.

It suggests confidence has risen in the Asia Pacific, European, Global Emerging and UK markets.

But confidence in the US, where inflation rose last week, has fallen slightly.

Emma Wall, head of investment analysis and research, Hargreaves Lansdown said: “Despite investors saying that they feel less confident about the region, trading reveals a different story. The most bought funds and trusts this month are US-centric, US trackers, active funds and global and tech investments that are US-biased.”

She said that while confidence has risen in the European market and across emerging markets, inflation – and associated higher interest rates – is still driving consumer and corporate decisions across the globe, from the slowing housing market, to striking public sectors, to gilt purchases.

She said: “Higher yields have sent money market funds into the top 10 most bought funds for the first time – a semi-permanent reminder that despite markets rallying, all is not well – or at least, normal – in the economic cycle. All eyes will therefore be on the Bank of England this week to confirm the more positive outlook.” 

Source: HL