New | Pimco says Fed unlikely to raise rates this week
Asset manager believes rate increase will come before the end of the year, but not in September
Pacific Investment Management Co, one of the world's largest asset managers, puts a "below 50 per cent chance" the Fed will raise short-term interest rates this week, Pimco Group chief investment officer Dan Ivascyn said on Monday.
Ivascyn said Pimco believes the US central bank's first rate rise in nine years will come before the end of the year, but not in September.
"The decision this week will be close," he said. "Global weakness, uncertainty around consumer sentiment, inflation still running below target are reasons the Fed will not move this week."
Pimco held its quarterly forum last week. Pimco managing directors as well as senior advisers discussed trends for economies and markets over the next 12 to 18 months.
Ivascyn's views are widely followed as he helps Pimco oversee assets that totalled more than US$1.52 trillion as of June 30, mostly in fixed-income securities. Pimco is a unit of Munich-based Allianz.
The recent market turmoil, stemming from China's currency devaluation, has called into question the Fed's long-telegraphed plans to raise rates from near zero this year, possibly as soon as tomorrow.