The US dollar is projected to recover moderately against major world currencies during the second half of 2008, a report said.

Merrill Lynch said in its Fund Manager Survey this month that the dollar is expected to strengthen modestly in the second half on a trade-weighted basis and positions by the fund managers seem to aligning in a similar direction.

The survey was conducted on fund managers with $615 billion in assets and it showed the dollar value has hit its bottom and will start an upward trend soon.

The Merrill Lynch survey also showed that equity fund managers' outlook for the global economy had improved as fewer respondents believed that the global real economy would be weaker over the next 12 months.