Gundlach Says Fed Should Raise Rate to 3% on Wednesday

DoubleLine Capital Chief Executive Officer Jeffrey Gundlach said the Federal Reserve should raise its target interest rate to 3% on Wednesday, calling for a hike that would be dramatically larger than what most forecasters are predicting.

The outspoken bond manager’s suggestion, delivered in a Tuesday night tweet, compares with forecasts from traders and banks including Goldman Sachs Group Inc. that the Fed will raise by 75 basis points on Wednesday. That would lift the upper bound of the Fed funds target rate to 1.75%.