Bill Gross Predicts Rate Hike in September as Fed Seen 'Wising Up'
Janus Capital's Bill Gross said in his latest Investment Outlook that he thinks the Fed will raise interest rates in September, unless there is a major global catastrophe. The Fed's rational for the rate hike isn't rising inflation, nor the continued downward push of unemployment to 5%.
Gross explained, "The reason will be that the central bankers that are charged with leading the global financial markets – the Fed and the BOE for now – are wising up; that the Taylor rule and any other standard signal of monetary policy must now be discarded into the trash bin of history."
"Low interest rates may not cure a fever – they may in fact raise a patient’s temperature to life threatening status," added the bond guru. "Yellen, Fisher, Dudley and company may not be in total agreement, but they assuredly are listening as this week’s Fed meeting will likely attest."
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William H. Gross, Janus CapitalSign up for StreetInsider Free!
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