"New Bond King" Gundlach: It is impossible for the Federal Reserve to cut interest rates

Golden Ten Data reported on May 18 that DoubleLine Capital CEO Jeffrey Gundlach stated that investors should not expect an interest rate cut at the next Federal Reserve policy meeting. “Previously, people expected two rate cuts this year, but the inflation market simply is not cooperating,” Gundlach said. “In my view, when the yield on the two-year US Treasury note is nearly 50 basis points higher than the federal funds rate, a rate cut is simply impossible.” Gundlach noted that just-confirmed Federal Reserve Chair Kevin Warsh is taking office at a “challenging time.” Gundlach added, “DoubleLine’s model indicates that the first digit of the next CPI reading will be a ‘4.’”