The collateral damage and unintended consequences of this prolonged experiment with very low interest rates [and] very big balance sheets are starting to have a meaningful [negative] effect on the economy, El-Erian told CNBCs Squawk Box.

Without a clear idea for the future of growth, the Fed has become overly data-dependent, El-Erian said, arguing that such an approach has been sending conflicting signals over time.

The former co-CEO of Pimco said investors are left wondering whether the Fed is being totally inconsistent or the Fed [is] being a slave of the markets.

The Fed raised rates in December for the first time in more than nine years. At the time, central bankers projected four more rate hikes in 2016. But the new year market turmoil scaled back those expectations.

As the stock market bottomed on Feb. 11 and marched higher, the minutes from the Feds April meeting put a June or maybe a July hike on the table. But recent concerns about what next weeks vote in the UK on whether to exit or stay in the European Union trading block have hurt stocks and pushed expectations of any future rate increases much further out.

The futures market now sees less than a 50 percent chance of even one hike by year-end.

Fed Chair Janet Yellen, in her post-meeting news conference Wednesday, even mentioned Brexit, and questioned how a leave vote could hurt the US economy, as a reason for not raising interest rates.

Yellen also broke out the phrase new normal to explain why central bank officials expect rates and economic growth to remain low through 2018.

The Fed is late to the party on that notion, argued El-Erian. [Pimco] first said new normal in 2009.

El-Erian said its difficult for Fed officials to resign themselves to the fact that slow growth was the result of structural, rather than cyclical factors. They were hoping for the handoff to a stronger economy after years of stimulus measures, he added.

The term new normal, coined by El-Erian and Pimco about seven years ago, referred at the time to the probability of prolonged slow economic growth, high unemployment and government debt problems.

At a time when state government budget problems make future funding for college campuses uncertain, the University of New Orleans is making the case for its importance to the New Orleans area economy.

LONDON Support for Britain staying the European Union has grown, restoring a narrow lead for the In camp ahead of Thursdays referendum on whether the country should stay in the bloc, an opinion poll published on Saturday showed.

The survey, by polling firm YouGov, showed a 44-43 percent lead for In, the Sunday Times newspaper reported.

It said YouGov attributed the bounce to growing concerns among voters about the economic impact of a so-called Brexit rather than the fatal attack on a British lawmaker on Thursday which has led to the suspension of referendum campaigning.

The Sunday Times poll was based on interviews conducted on Thursday and Friday.

(Writing by William Schomberg; Editing by Jon Boyle)

The IMF delayed publication of the report by a day after campaigning in the referendum was halted following the fatal shooting of Labour Party lawmaker Jo Cox on Thursday. Speaking on Friday, Managing Director Christine Lagarde said her thoughts were with Coxs family and friends.

In its report, the IMF presented forecasts for limited and adverse Brexit scenarios. In the worse situation, it sees growth slowing sharply this year and the economy shrinking 0.8 percent in 2017. The impact would see the economy 5.6 percent smaller by 2019 compared with a baseline forecast, while unemployment would rise above 6 percent and the deficit would be wider.

IMF officials said that a permanent hit to output would probably mean deeper austerity. Chancellor of the Exchequer George Osborne has said an emergency budget would be required within two months of a Brexit to fill a hole in the public finances.

While recognizing that this choice is for UK voters to make and that their decisions will reflect both economic and non-economic factors, directors agreed that the net economic effects of leaving the EU would likely be negative and substantial, the organization said.