Doubleline’s Gundlach Says Fed May Need Rate Hikes To Restore Inflation Credibility As Bond Market Challenges Policymakers

Jeffrey Gundlach said the Fed may need more rate hikes, not just a pause, to restore credibility on inflation.

He argued recent Treasury market moves show investors doubt the Fed will bring inflation back to 2% without further tightening.

After the Fed held rates steady, longer-term Treasury yields jumped while the 2-year yield fell, signaling mixed expectations for policy.

The comments underscore growing market skepticism that inflation will return to target without keeping borrowing costs higher for longer.