Simultaneously, Hasenstab believes that the Fed will be pressured to increase interest rates after the impact of low oil and commodity prices finishes circulating through the markets.
“The incredibly accommodative monetary policy in the face of inflation will create imbalances and will need to be corrected,” Hasenstab said.
Hasenstab said that while recession might not be imminent, it is still on the horizon.
“Looking five years out, it’s hard to predict that you wouldn’t have a recession at that point,” he said. “For the next year to two years, you have to remember that this was an exceptional drawdown and an exceptionally strong recovery. You can’t look at the historical patterns. This cycle is going to be elongated and as a result it probably lasts a little bit longer.”