NEW YORK (CNN/Money) - The outlook for the world economy is more uncertain than anytime in the last 20 to 30 years, the manager of the world's biggest bond fund, Bill Gross, was quoted as saying Thursday.

Gross, chief investment officer at Pimco, told the Financial Times that too much debt and global uncertainty have created "a very unstable environment which can turn any minute."

"More than any point in the past 20 or 30 years, there's potential for a reversal," Gross was quoted as saying. "We have become a levered global economy, specifically in Japan and the U.S.

"With all this consumer debt, business debt, government debt, smaller movements in interest rates have a magnified effect... a small movement can tip the boat," Gross told the newspaper.

Pimco manages $400 billion in bonds, about a third of which is currently invested outside the United States, the highest level of overseas investment for his funds to date.

Gross plans to keep money out of the U.S. and in Britain and Germany, places that would not be as badly hit by inflation, according to the report. Inflation is anathema to bond investors since it erodes returns on their investments.

Gross also said he sees bubbles in the dollar.

"The U.S. dollar is being supported by the kindness of strangers -- Japan and China," he was quoted as saying.

"It should be 20 percent lower than it is. Japan and China will change their stance. We don't know when, but we know they will. The dollar isn't overvalued against the euro, but it is against Asian currencies."

In his widely read Investment Outlook in May, Gross warned that accelerating inflation and the higher interest rates that come with it are still the most likely scenario for U.S. investors.

"All is well until something tips the walker to one side of the wire or the other," he said in the report.