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Pimco’s El-Erian Says Bank Tests a Good Signal for Economy

Pacific Investment Management Co.’s Mohamed El-Erian said the Federal Reserve’s stress tests on financial institutions were a good sign for an economy that may still receive another round of asset purchases from the bank.

“They were credible and unambiguously this is good news,” El-Erian, the chief executive officer of the world’s largest manager of bond funds, said of the bank tests during an interview on Bloomberg Television’s “In the Loop” with Betty Liu. “The big hope for everybody is that they’ll start lending into the real economy.”