Gundlach Unlocked: The Fed’s Next Move

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DoubleLine CEO-CIO Jeffrey Gundlach’s latest Gundlach Unlocked webcast reviews the macroeconomic landscape heading into next week’s Federal Open Market Committee meeting. Mr. Gundlach remains skeptical that the Federal Reserve will hike rates despite the market pricing a real probability of one, and he warns that a hold could push long-term rates meaningfully higher given persistent inflation pressure. Mr. Gundlach also flags a growing divergence in credit markets, with spreads on AI-related corporate bonds widening sharply even as the broader market holds near its tights for the year.

On inflation, he points to several troubling data points, from rising import and export prices to a CPI trajectory Mr. Gundlach says looks eerily similar to the setup that preceded the inflation spiral of the 1970s. On equities, he reiterates his warning about historic market concentration and continues to favor a more equal-weighted approach rather than through the capitalization-weighted S&P 500 Index. He closes bearish on the U.S. dollar and constructive on both emerging markets equities and local currency debt, while he cautions that the U.S. Treasury Department’s newly announced buyback program is unlikely to meaningfully move long-term U.S. Treasury yields.

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DoubleLine Capital LP

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DoubleLine has been managing money for insurers since its inception in 2009. The firm's focus on securitized fixed income and risk management positions it well to manage money for insurers. The firm offers an array of fixed income strategies including dedicated ABS, private ABF, CLOs, infrastructure debt, non-QM, commercial and residential loans, multi-sector fixed income and EM. We understand that the needs of each insurer can vary, and our insurance team is focused on providing our clients with unparalleled access to the investment team and creating custom solutions to meet their distinctive objectives. DoubleLine wants to be your fixed income partner.
 

Paul Schroeder, CFA   
Relationship Manager- Insurance  
paul.schroeder@doubleline.com
Direct: 213-372-3123
Main: 813-791-7333
 

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