Matt Winkelmeyer
DoubleLine Capital CEO Jeffrey Gundlach on Wednesday suggested the Federal Reserve could finish 2024 without cutting interest rates.
Fed Chairman Jerome Powell said at his June policy press conference on Wednesday that monetary policymakers want “greater confidence.” Inflation has been declining sustainably before the interest rate easing cycle begins. May CPI Report Powell noted Wednesday that core inflation rose to the lowest level since 2021, signaling progress. But inflation data so far this year “doesn’t inspire a great deal of confidence,” he said.
Gundlach told CNBC he’s “not very confident” about one rate cut this year. “It feels like the Fed is in reaction mode. If the data starts to get shaky, you’re going to see the Fed react harder and react quicker,” he said. Gundlach expects inflation to fall.
Gundlach said that as the Fed continues to grapple with inflationary pressures and events that affect inflation, it is possible that Powell “will be talking about Fed rate hikes” in the future.
Gundlach said in May that the Fed might decide to cut interest rates just once this year as inflation languishes above the central bank’s 2% target.
The S&P 500 (SP500) and Nasdaq Composite Index (COMP:IND) closed Wednesday at new highs.
