PIMCO's Gross Urges Rethink of UK Recovery Strategy

The austerity measures implemented by British finance minister George Osborne risk pushing the UK economy into recession, Bill Gross, the manager of PIMCO, said in an interview with the Times newspaper.

Bill Gross
Bill Gross

Gross, who manages the world's biggest bond fund, told the newspaper that a "mid-course correction" of the fiscal plans would lift the economy and should not damage the country's standing with bond investors.

"Theeconomy in the UK is worse off than it was when the plan was developed, so there should be at a minimum fine-tuning and perhaps re-routing of the plan," he was quoted as saying.

Gross said a similar argument applied to other leading economies, including in the euro zone and the United States, which he said faced a mounting crisis.

"The UK is actually in the best position of all to make a mid-course correction," Gross said.

He told the newspaper that he did not want a 180-degree U-turn but that for PIMCO "a mild re-adjustment that might keep the economy out of recession would be viewed very favourably".