The Federal Reserve will probably start to scale back on its massive bond-buying program this week and will try to help ease the market impact of the taper, Pimco's Mohamed El-Erian told CNBC on Monday.
The Fed's long-awaited two-day September meeting begins Tuesday and it's widely expected that central bank policymakers will announce that it is starting to reduce its $85-billion-a-month asset purchases.
At the conclusion of its meeting on Wednesday, the Fed will provide interest rate guidance and economic projections, and Fed Chairman Ben Bernanke will hold a news conference.
"We think this week is more probable than not," El-Erian said when asked when he thought the taper policy would be announced. He said he expected a $10 billion to $15 billion reduction.
"They're going to try to strengthen the forward guidance in order to minimize the impact on markets of the taper," the Pimco CEO and co-CIO added in a "Squawk Box" interview.
(Read More: Is Bernanke staying a possibility with Summers out?)
The Fed won't be tapering because economic conditions have improved that much, but because of what Bernanke has described as the costs and risks to the markets of prolonged bond-buying, El-Erian said.
"The reason why we're going to see the taper is not because of the declared 'big victory on the economy'", he continued, "[but] because they're worried about what Mr. Bernanke called the cost and risks—the collateral damage if you like—of using such a blunt instrument to impact markets."
In a year, the Fed will likely be through most of the taper, El-Erian predicted, but said he doesn't think there will be an increase in interest rates by then because "the economy remains weak."
Bernanke is widely expected to end his tenure at the Fed after his second term as chairman expires in January.
On Sunday, the presumed leading candidate for the job, former Clinton Treasury secretary and Obama economic adviser Larry Summers, withdrew his name for consideration as opposition among Democrats on the Senate Banking Committee mounted.
El-Erian said the stock market's interpretation that Fed Vice Chairwoman Janet Yellen is now the frontrunner to succeed Bernanke is correct. Investors believe she will keep Fed policy moving in its current direction, he said.
(Read more: Wall Street wanted Yellen anyway: CNBC survey)