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2026-09-16 00:52:14
[DoubleLine: Fed Needs Rate Hike to Stabilize Bond Market] Jeffrey Sherman of DoubleLine Capital says the Federal Reserve needs to raise interest rates to convince traders of its commitment to suppressing inflation and to alleviate market concerns that pushed the 10-year U.S. Treasury yield above 5% this week. The asset management firm's deputy chief investment officer told Bloomberg TV that Fed Chairman Kevin Warsh "has the ability to help by raising rates tomorrow." Sherman said, "The market has already priced in the rate hike; they either act or they shut up." Sherman also said the Fed needs to signal that it will raise rates further after Wednesday's 25-basis-point hike. Doing so would reverse the policy easing resulting from the Fed's three rate cuts since September 2025. Swap traders have largely priced in this week's 25-basis-point rate hike and expect a cumulative rate increase of about 0.95 percentage points by September 2027.
