Gundlach Urges Fed to Hike From 3.75%-4% as December Move Seen 85% Likely
Updated
Updated · CNBC · Oct 28
Gundlach Urges Fed to Hike From 3.75%-4% as December Move Seen 85% Likely
3 articles · Updated · CNBC · Oct 28
Summary
Jeff Gundlach said the Federal Reserve is "behind the curve" after holding rates steady in October, arguing policymakers should still raise by 25 basis points in December.
He pointed to headline CPI heading toward 4%, a commodity bull market and U.S. oil staying above $100 a barrel, saying those conditions do not justify a pause.
Gundlach also said the fed funds rate at 3.75%-4% sits well below the 2-year Treasury yield near 4.7%, which he sees as evidence policy remains too loose.
CME FedWatch still shows an 85% chance of a December hike, while the Fed said future moves will depend on incoming data as it works toward its 2% inflation goal.
Beyond the rate call, Gundlach backed fewer rate-setting meetings, after Chair Kevin Warsh said one 2027 meeting and two in 2028 will focus on strategy rather than a fed funds vote.