Star investor Bill Gross of Janus Capital Group often sports a contrarian view from the market consensus. But he's not far off the beaten path when it comes to the timing of Federal Reserve interest rate hikes.
Like others, he expects the first increase to come in June or July, totaling 25 basis points.
"We will probably know by March for sure,"
Gross told the Financial Times. "In the March meeting, the Fed will either keep their patient language or they will drop it, and that will be the signal as to whether the rise will come in June or whether it is later."
In its last two policy statements the Fed has said it will be "patient" in lifting rates. Gross expects the central bank to boost rates twice this year.
It has kept its federal funds rate target at a record low of zero to 0.25 percent since December 2008.
Hedge fund heavyweight Doug Kass, president of Seabreeze Partners, thinks the Fed is waiting too long to raise rates.
"The Ah-ha Moment may be at hand, in which confidence in the Federal Reserve (and the other central banks around the world) disintegrates under the weight of a too-lengthy period of zero interest rates and excessive QE and injections of other liquidity,"
he writes in his blog on Tumblr.
"They explored that space for too long, and the marginal impact of ever more [stimulus] might be diminishing. Indeed, the impact of ever lower interest rates may now be net negative to the U.S. economy.
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