April 4, 2018 / 8:28 PM / 10 months ago

Pimco's Ivascyn warns late-cycle deficit spending raises 'hard landing' risk

NEW YORK, April 4 (Reuters) - Dan Ivascyn, group chief investment officer at Pacific Investment Management Co, said Wednesday that the late-cycle deficit spending “increases the risk of an eventual hard landing for the economy by forcing the Federal Reserve to be more proactive.”

Speaking to Reuters, Ivascyn, who helps oversee over $1.75 trillion at Pimco, also said of a prospective trade war with China: “A more aggressive trade war is not necessarily bad for high-quality bonds as it will likely lead to a weaker business environment and even lead to reduced household confidence which in turn mean a weaker economic backdrop. You could see a flight-to-quality into bonds under this scenario.” (Reporting by Jennifer Ablan Editing by Susan Thomas)

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