INVESTORS FLEE TO CASH AS UNCERTAINTY SURGES
Investors are shifting back to cash in a move reminiscent of 2022, according to JPMorgan, as geopolitical tensions and policy risks rise.
Strategist Nikolaos Panigirtzoglou says investors have been pulling out of equities, bonds, and gold since the Iran war began, boosting cash holdings instead.
The shift reflects fears that central banks could repeat past policy mistakes, especially as energy shocks risk fueling inflation and forcing further rate hikes. Markets have already priced out expected rate cuts and are now anticipating increases in the coming months.
While cash allocations have only risen modestly and remain low historically, they are still weighing on stocks and bonds. Meanwhile, equity positioning has dropped sharply from recent highs, signaling growing caution among investors.