By Sam Forgione

NEW YORK (Reuters) - PIMCO founder and co-chief investment officer Bill Gross, who heads the world's largest bond fund, took issue with the Federal Reserve's decision on Tuesday to keep U.S. interest rates low until 2014.

During a CNBC interview, Gross said that the Fed's decision will continue to "subordinate" bond investors.

Gross said "April holds the key" as the time when the board could enact another round of stimulus or quantitative easing.

In past quantitative easing moves, the Fed has either bought Treasuries or mortgage-backed securities.

Gross also disagreed with the Fed's pronouncement that inflationary expectations have remained stable, saying the Fed "is playing a game" by saying otherwise.

PIMCO's Total Return Fund, with $250 billion under management, upped its exposure to mortgage-backed securities in February to 52 percent of the fund's portfolio. It had been 50 percent at the end of January.

Gross has been steadily plowing into mortgage-backed securities on the expectation that the Fed would announce a new round of mortgage bond buying. But with the Fed's latest decision, it appears a new round of mortgage bond buying by the Fed is on hold, or least delayed for the time being.

(Corrects 5th paragraph to "inflationary expectations" from "inflation")

(Reporting by Sam Forgione; Editing by James Dalgleish)