Jeffrey Gundlach, CEO of DoubleLine Capital, said that signals from the U.S. Treasury market indicate that if Federal Reserve (Fed) policymakers are serious about their 2% inflation target, they need to take more action—not just adopt a tough rhetoric. Gundlach pointed out that following the Fed’s latest policy decision, the U.S. Treasury yield curve has diverged, indicating that investors are skeptical about whether the Fed will ultimately be able to carry out its policy. He believes that to reach the 2% inflation target, the Fed needs to raise interest rates.