Gundlach says Fed to include 'hawkish no-hike' language
- Wall Street dips on Trump protectionism, Qualcomm drag
- Yahoo! (YHOO) Tops Q4 EPS by 4c; Sees Verizon Deal Closing in Q2, Not Q1
- Aetna's (AET) Humana (HUM) Takeover Blocked by Judge as Anticompetative
- Trump signs order withdrawing U.S. from Trans-Pacific trade deal
- After-Hours Stock Movers 1/23: (REXX) (MRCY) (SYNC) Higher; (FSM) (OCUL) (CASC) Lower (more...)
Jeffrey Gundlach, Chief Executive Officer, DoubleLine Capital LP., speaks at the Sohn Investment Conference in New York City, U.S. May 4, 2016. REUTERS/Brendan McDermid
Get inside Wall Street with StreetInsider Premium. Claim your 2-week free trial here.
By Jennifer Ablan
NEW YORK (Reuters) - The Federal Reserve will not raise interest rates when it meets this week, but the U.S. central bank will include “hawkish no-hike language,” Jeffrey Gundlach, chief executive of DoubleLine Capital, said on Monday.
In a telephone interview with Reuters, Gundlach said Fed officials “want to be able to raise rates later this year if the WIRP (World Interest Rate Probability) index is in the 40s,” Gundlach said. Currently WIRP, which measures the implied probability of an interest rate hike between 0 and 100, sits around 18 percent for the Fed's meeting on Sept. 21.
Gundlach, who oversees more than $100 billion at Los Angeles-based DoubleLine, said earlier this month on an investor webcast that Fed officials want to show that they are not guided by the markets. "The Fed wants to show, at some point, that they can’t be replaced by WIRP. The only way they can do that is to tighten when WIRP is below 50," Gundlach said on the webcast.
Gundlach told investors that the Fed will not hike in September if the WIRP is below 40 and the S&P 500 is below 2150.
On Monday, Gundlach also said Treasury bonds are "sniffing out a new bond-market unfriendly environment, which likely includes a fiscal-policy pivot."
In that regard, the yield on the 10-year Treasury note is in a new range: "1.70 percent is the new 1.55 percent."
(Reporting by Jennifer Ablan; Editing by James Dalgleish and Andrew Hay)
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Gundlach sees Trump views weakening dollar, boosting TIPS demand
- Trump's Treasury nominee keeps senators guessing on China currency stance
- Humana (HUM) Gains Into Close with Merger Blocked
Create E-mail Alert Related CategoriesFed, Hedge Funds, Reuters, Rumors, Trader Talk
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!