“Love it or leave it,” as the old saying goes. Increasingly, investors are choosing the latter.

A record number of fund managers in the April installment of BofA’s monthly survey said they plan to cut US stocks in their portfolios, yet another reflection of the about-face in perceptions and preferences since the beginning of 2025.

“US exceptionalism” was the overwhelming macro-market consensus as the new year dawned, but a blitzkrieg of controversial policy decisions from the Trump administration upended the narrative.

Suddenly, no one wants anything to do with US assets including, increasingly, the dollar itself.

The figure on the left, from the BofA poll, shows a record share want to be Underweight the US. The figure on the right shows the net share saying the profit outlook for corporate America’s “favorable” — it’s the lowest since 2007.

Suffice to say fund managers aren’t sure the “goodies” from the Trump agenda (i.e., tax cuts and deregulation) will come fast enough to offset the margin drag from tariffs and demand destruction tipped by flagging consumer sentiment and rising recession odds.

“Global investor confidence in USD assets remains shaken, as the decades-old ‘US exceptionalism’ trade is now unwinding, being deleveraged and bleeding out in a slow burning asset reallocation,” Nomura’s Charlie McElligott said, noting that the flows picture continues to suggest investors favor “fiscal expansionists” in Europe, stimulus plays in China or “actually constructive” economic stories like Japan. Legacy winners in US assets, he wrote, are acting as a “source of funds” for those trades.

Meanwhile, a net 61% in the BofA poll said they expect the dollar to depreciate over the next 12 months.

As the figure shows, that was the most in 19 years.

“The dollar’s position at the center of the global financial system isn’t written in stone, but it wouldn’t be easy to dislodge either,” SocGen’s Kit Juckes remarked.

In an interview with Bloomberg early this week, Scott Bessent said he’s not concerned about the juxtaposition between higher US yields and a weaker dollar, a colocation that unnerved many observers last week. “We are still a global reserve currency,” he told Annmarie Hordern. (When you have to say it…)

“To the extent foreign investors are concerned about the size of their exposure to US bonds, maybe we shouldn’t be too surprised to see both the dollar and the Treasury market sell off at the same time,” Juckes went on, in the same note mentioned above. “The bigger question is whether, as market liquidity improves, foreign investors buy into the market selloff or simply want to reduce US exposure.”