Investors in Monaco are the most pessimistic while those in Spain are the most positive, survey shows

News - Banking

Written by Ray Clancy

Investors in Monaco are the least positive followed by those in Japan and the US who are gloomy about the prospects for global economic recovery in the next five years, a new survey shows.

The rich prefer to invest in property as they see it as the safest asset class and the one with which they are most familiar, according to a report from London-based Barclays Wealth.

It found that more than half the people in Monaco with more than £1 million to invest expect the economy to deteriorate, While 35% in Japan, 25% in the US, 17% in Switzerland and 16% in the UK are pessimistic. The most optimistic investors are in Spain where 40% expect the global economy to expand over the next five years.

Those with more than £10 million to invest are more negative than single-digit millionaires, Barclays found in the survey of 2,000 investors in 20 countries during February and March.

The International Monetary Fund forecast last month that the world economy will expand 4.2% in 2010, the fastest pace since 2007.

‘We’re seeing in our conversations with clients that there is skepticism about things picking up,’ said Philippe Sednaoui, chief executive officer of Barclays’s Swiss wealth business.

‘There’s a real disconnect between the private owners of money and the institutional view of money managers,’ explained Sednaoui, whose Swiss unit aims to almost double client assets under administration to 30 billion Swiss francs over the next three years.
Property Preference

‘Clients were telling us they were afraid of inflation and property is a good reserve of value, not unlike people investing in gold,’ added Sednaoui.

Barclays expects the sovereign debt crisis in Europe to lead to a wider revaluation of bond markets and it expects the Euro, which weakened to a four- year low of $1.2144 on May 19, to trade at $1.25 in six months and $1.35 in 12 months. The euro-region currency has declined 13% this year.

Barclays Wealth, which targets individuals with more than £5 million pounds to invest, managed £151.2 billion for clients worldwide at the end of 2009.