Jeffrey Gundlach, ‘The Bond King’ urges to Fed to raise rates to 3% immediately

Jeffrey Gundlach tweeted on Tuesday. That ‘The federal reserve should raise the fed funds rate to 3% tomorrow’

 Most of the wall street traders expect U.S. central bank to approve a 75-basis point rate hike at their Wednesday meeting, which will already mark the steepest increase since 1994. That the federal fund's range would lift from 1.5% to 1.75%.

75-basis point move following the hotter-than-expected May inflation report after markets started pricing in the mega-sized, which shows that last month prices surged 8.6%-and this was the fastest pace since December 1981. Most of the Americans expect prices to rise even more faster by the next year, as per a separate survey tracking consumer expectations. And such types of prophecies can become self-fulfilling as a worrisome sign for the U.S. central bank.

Many economists are believing that the Fed is acting too late to quell inflation – so does the Gundlach. 

 For not moving more quickly just to withdraw the pandemic-era support. The so-called “Bond King” has been a frequent critic of the central bank, and is taking aim at policymakers.

"An intelligent twelve-year-old was able to predict it." That Gundlach tweeted “Excessive stimulus caused inflation”, earlier this month.

 Previously the chairman Jerome Powell has rebuffed the possibility of a 75-basis point hike and also so far avoided spooking the markets with surprise moves. But this was before April and May inflation reports that came in hotter than expected, by reviving the possibility of a previously unthinkable 75-basis point increase. Also, the latest economic data will guide the steps taken by the Fed as per Powell pledged.