Billionaire Jeffrey Gundlach, who runs DoubleLine Capital, is urging the Federal Reserve to raise interest rates by 50 basis points at its October meeting, citing inflation indicators similar to the 1970s with import and export price growth near 7% and oil hovering around $100 per barrel. Such a hike would push the effective rate from its current range of roughly 3.63%-3.75% up to 4.25%, while the 10-year Treasury yield already approaches 4.80% and the 30-year has surpassed 5.25%. Gundlach warns of a dramatic spike in long-term Treasury yields if the Fed remains inactive and recommends investors shift toward equal-weighted strategies rather than cap-weighted indexes to reduce concentration risk. Futures markets are pricing in a 64% probability of a rate increase in October.
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