Summit Notebook

Exclusive outtakes from industry leaders

AUDIO – Gross sees Fed cutting 25 bps, says mortgage rate needs to hit 5 pct

December 11, 2007

homesforsale.jpgPIMCO’s chief investment officer Bill Gross told the Reuters Investment Outlook 2008 Summit he expects the Federal Reserve to announce a 25 basis points cut in the federal funds rate on Tuesday afternoon but says much more will be needed.

Gross, who was speaking about three hours before the decision will be announced, said that to put a floor under the U.S. housing market,  the Fed will need to cut the rate to around 3 percent and will need to get the 30-year home mortgage rate for prime borrowers down to around 5 percent. The audio of his comments is attached.

Post Your Comment

We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/
  •