A BofA Merrill Lynch Global Research report depicted that the risk appetite re-emerged as concern eased that interest rates will have to increase later this year, aiming to tranquilize unceasingly rising inflation rates, triggering investors to reduce cash holdings and acquire equities.

The Merrill Lynch survey involving 207 fund managers was conducted from March 5 to March 11. As of January 2009 Merrill Lynch altered the format of its survey and no longer publishes full historical data.

In the survey, among the respondents seventy percent, who together mange about $589 billion, hope the Federal Reserve to keep interest rates at a record low level until at least the fourth quarter of 2010, as concern that inflation will return slip steeply.

While, fifty percent revealed that they speculate the European Central Bank to keep its benchmark interest rate unaltered until 2011.

"The big change for investors is the drop in inflation worries", Gary Baker, head of European equity strategy at BofA Merrill, posted at a press briefing in London today. "Investors are now much less concerned about when they expect interest rates to rise and see it more as a 2011 event".

It is reported that BofA Merrill Lynch's risk appetite index registered a rise to 44 from 42 as a net 46 percent of money managers had large amount of stocks in March.