Asia Fund Manager Survey: Waiting for AI monetization and BoJ normalization

The BofA September Asia Fund Manager Survey, with 190 panelists managing $512bn AUM, finds that 80% of investors seek clearer proof of tangible AI monetization before adding AI exposure, favoring rotation into defensives as a downside hedge. Nearly 80% expect a BoJ rate hike this month, with the perceived USD/JPY intervention trigger falling to 160. Investors are bullish on Asia ex-Japan (6.3% expected upside, 89th percentile) and Japan equities (6.4%, 94th percentile). BoJ policy normalization has overtaken earnings as the dominant Japan theme. Japan and Taiwan remain the most favored APAC markets; Japan positioning is concentrated in banks (record high) and semiconductors, while Software & Platforms offer the best perceived AI risk-reward.