• Says interest rate increases this year not off the table
  • Confidence won't rise until oil bottoms, China starts stimulus

The Federal Reserve will hold off raising interest rates if market volatility continues, said Dean Maki, chief economist at Point72 Asset Management, the firm that manages the fortune of billionaire trader Steven A. Cohen.

"The Fed is paying attention. They’re not going to make the situation worse by raising rates into very volatile markets," Maki said today in an interview on Bloomberg Television with Stephanie Ruhle and David Westin. "I think they do still plan to raise rates this year," he added, in contrast to what some trading measures suggest.

Investors are watching Fed Chair Janet Yellen closely for signals on the pace of monetary tightening as she gives semi-annual testimony to Congress starting Wednesday. Concerns over China’s economic slowdown and the European banking sector, as well as a continued decline in the price of oil, have increased speculation that a tightening cycle the Fed began in December may have already ended.

"Do the fundamentals justify the fear that is out there? In this case, in most cases, no," Maki said of this year’s selloff in global stocks, pointing to growth in the U.S. and Europe. What the Fed is worried about, he said, is a negative “feedback loop" from financial markets into the real economy.

He said investor confidence isn’t likely to improve until oil hits a bottom and China starts economic stimulus measures.

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