Schroders' Isaac: US rate hike may be 'aggressive'

The Federal Reserve may have to resort to an 'aggressive' rate hike as a consequence of stalling the decision for too long, according to Schroders' Strategic Bond fund manager Gareth Isaac.

Isaac (pictured) warned the Federal Reserve is waiting too long for certain inflation and wage data and may have to hike interest rates quickly when these indicators come through. "We do not think the rate hike in the US will be slow and gradual," the manager said. "The [Fed] tends to let markets run too hot for too long, and ends up having to raise rates quite aggressively." Isaac pointed to the unemployment rate in the US, which has fallen sharply in recent months to just 5.8% in November, and may begin to cause inflationary pressures if it falls much further. "If the Fed waits u...