June 22, 2015 / 12:44 PM / 4 years ago

Most investors see limited markets impact from Grexit - Barclays

LONDON, June 22 (Reuters) - More than half of investors in a Barclays survey see a Greek exit from the euro zone as having only a minor impact on global financial markets because the country is small and buffers are in place to limit contagion.

Close to 30 percent saw only a limited effect on other peripheral euro zone economies, and fewer than one in five believe “Grexit” would be a big negative for global markets, Barclays’ June 10-17 survey of 899 investors found.

Only 23 percent expect Grexit in the next three months.

The survey was taken when euro zone officials and leaders were scrambling to break the deadlock in talks on an aid-for-reform deal that would avert default at the end of the month.

On Monday, euro zone officials welcomed Greek concessions as a possible step towards a deal on averting default, although politicians dismissed expectations of a breakthrough at a summit later in the day.

Nearly 60 percent of the investors surveyed also viewed the sell-off in core bond markets as showing that fears of the region sliding into deflation have disappeared, while 34 percent considered it a bigger threat to global equity markets.

Only 15 percent thought the bond sell-off was due to an improved inflation outlook in the euro zone while 44 percent of fixed-income investors said German Bund yields had more room to rise in coming months.

“This suggests a big revision in investors’ expectations about Bund yields since our last survey,” Barclays said. Last quarter, only 5 percent of investors thought Bund yields would rise above 0.5 percent.

Barclays did not say how much in assets the investors in the survey managed. (Reporting by Emelia Sithole-Matarise; Editing by Louise Ireland)

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