Causer: Fed hike should not be disaster for bonds but expect temporary 'bear market dynamics'

No need for 'violent reaction'

Paul Causer, co-head of the fixed interest team at Invesco Perpetual, has said an interest rate hike in the US is merely an adjustment the market "needs".

Although the veteran bond manager (pictured) admitted he is "concerned" about the impact on bond markets, he said there is no need for a "violent reaction" and that rates must go up. "I am concerned but, as a fixed income fund manager and an investor myself, we need interest rates to go up," he said. The Federal Reserve is expected to hike rates soon from a seven-year low of 0.25%. Had the Fed become hostage to inflation expectations? It is widely expected there will be movement higher before the end of the year, with some saying it could be as early as tomorrow following the Fed...