Pimco, the world's largest bond fund, is cutting back on riskier assets on view the global economy might continue cooling, says the fund's senior portfolio manager Saumil Parikh.

Less risky assets include high-grade emerging-market debt and U.S. municipal bonds.

"Emerging economies are in a very different cyclical position relative to developed economies. We expect emerging economies to transition from being producers and investors of last resort to being consumers of first resort over the secular horizon," Parikh says in a letter, CNBC reports.

"Given our outlook for slow growth globally and recession in Europe, we are focusing on protecting portfolios against downside risk."

Growth may be sluggish in the U.S. but it's better than recession, which many fear is facing the U.S.

The Commerce Department says a third revision of gross domestic product shows the economy rose 1.3 percent in the second quarter, up from 1 percent previously and well above the first quarter’s paltry 0.4 percent growth rate, Fox Business reports.

Consumer spending, the motor of the U.S. economy, is showing signs of life, with growth revised up to 0.7 percent from 0.4 percent.

"The market is pricing in recession and the economic data just don’t show any signs of that," says Michelle Girard, senior economist at RBS Securities, Fox News adds.

"Actually, in report after report, none of the news looks particularly great, but none of them suggest the U.S. is slipping back into recession."