The bears appear headed for an early hibernation, according to the Bank of America Merrill Lynch (BofAML) survey of fund managers for August. BofAML, a unit of Bank of America, said the bearish sentiment for the global economic outlook and corporate earnings has eased. The most recent data show 5% of survey respondents expect the global economy will improve in the next year. "The spotlight of investor pessimism has shifted away from China and Europe to Japan and the U.S." according to Michael Hartnett, chief global equities strategist at BofAML global research. "Investors clearly remain cautious, so better news on U.S. growth and fiscal policy would be a pleasant surprise." In July, 12% percent of respondents predicted the world economy would deteriorate, BofAML said. But recession fears seem to have subsided, as 78% of fund managers surveyed last week don't expect a double-dip recession. Still, 73% continue to see "below-trend growth and inflation." Just 1% of respondents in the August survey expect inflation to decline over the next year. That's down from 12% in July, and more than half of the respondents "are ruling out any rate hike in the U.S. before the third quarter of 2011," according to BofAML. The company polled 187 fund managers, who manage $513bn, in the global survey between Aug. 6 and Aug. 12. Some 157 managers, managing $327bn, participated in the regional surveys. Write to Jason Philyaw.