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Billionaire ‘Bond King’ Jeffrey Gundlach Expects Fed to Raise Rates Next Week — ‘That Would Be the Last Increase’

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Billionaire Jeffrey Gundlach, aka the “Bond King,” expects the Federal Reserve to raise interest rates at its March meeting next week, which “would be the last increase,” he said. In addition, Gundlach cautioned: “The inflationary policy is back in play with the Federal Reserve.”

Doubleline CEO Jeffrey Gundlach on Fed Rate Hikes

Jeffrey Gundlach, chief executive and chief investment officer of investment management firm Doubleline, shared his Fed rate hike expectations in an interview with CNBC Monday. Gundlach is nicknamed “the Bond King” after he appeared on the cover of Barron’s as “The New Bond King” in 2011. According to Forbes, his net worth is currently $2.2 billion.

Following the collapses of Silicon Valley Bank and Signature Bank, many economists have revised their rate hike predictions. Global investment bank Goldman Sachs, for example, no longer expects the Fed to raise interest rates in March.

Regarding whether the Federal Reserve will raise interest rates at its next Federal Open Market Committee (FOMC) meeting next week, Gundlach said: “I just think that, at this point, the Fed is not going to go 50 [basis points]. I would say 25.” He elaborated:

To save, kind of, the program and their credibility, they’ll probably raise rates 25 basis points. I would think that that would be the last increase.

Noting that the Silicon Valley Bank fallout is “really throwing a wrench in [Fed Chair] Jay Powell’s game plan,” the executive emphasized: “I wouldn’t do it myself. But what do you do in the context of all this messaging that has happened over the past six months, and then something happens that you think you’ve solved.”

On Sunday, the Treasury Department, the Federal Reserve Board, and the Federal Deposit Insurance Corporation (FDIC) disclosed a plan to support depositors at failed Silicon Valley Bank and Signature Bank. The Treasury D

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Author: Kevin Helms

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