M&G's Woolnough questions Fed's hesitation on rate rise

Richard Woolnough, manager of the £24bn M&G Optimal Income fund, says he is at a loss to understand why the US is holding off on raising interest rates.

Speaking at the Fidelity FundsNetwork investment forum last week, Woolnough (pictured) was asked if he expects the US Federal Reserve to raise rates in December. The manager said positive economic data indicates they should be raised sooner than that.  "They should start raising rates earlier than December," he said. "I do not understand why they will not just get on with it as it takes 12-18 months for a rate rise to filter through to the economy." He pointed to the low unemployment figures in the US as a signal for rates to be increased. The US added 223,000 jobs in April, mainly...