Worah is betting that the nation's debt will rebound following the Federal Reserve's surprising decision Wednesday to continue its monetary stimulus. The move suggests that Pimco is confident that the Fed's easing policy will push up inflation in the long term.
He said the central bank "made it clearly they want inflation to go higher than where it currently is," but he acknowledged that bullish bets on TIPS face negative risk if redemptions persist.
"We are concerned whether they can control that when inflation hits the 2 percent target," he added. "So TIPS should do well for the rest of the year."
Inflation-protected markets rallied Wednesday and outpaced the price gain in regular Treasury bonds.
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