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June 10, 2015 at 10:24 AM
DoubleLine CEO and bond guru Jeffrey Gundlach said Tuesday that he sees the chance of a hike in interest rates less than 30% for September and under 50% for December.
The bond market, according to data, “weirdly” believes the odds of a hike this year have risen, Gundlach says, but he does not agree. “I would take the under on that … I think the odds of raising rates by December is less than 50%,” he explained during a quarterly webinar.
“The Fed’s willingness to increase interest rates has diminished,” Gundlach said.
During the webcast, the fixed-income expert showed analysis of Bloomberg data through Monday. The figures show that the bond market sees the likelihood of a rate hike at 0% for June, about 29% for September and 58% for December.
These figures jump to 64% in January 2016 and 91% in June 2016.
A survey of 125 financial advisors released early Wednesday by SEI finds that 53% of financial advisors anticipate a rate hike by year end. The survey also shows that 50% of advisors polled believe a hike will lead to a market downturn, and 78% expect the Dow Jones to return less than 10% in 2015.
According to market figures shared by NAREIT on Wednesday, the Dow Jones industrial average is down 0.3% so far in 2015, while the S&P 500 is up nearly 2%. The Russell 2000 has improved close to 4.3%, while the Nasdaq’s growth stands at almost 6%.
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