"New Bond King" Gundlach: The US dollar has entered a long-term depreciation cycle, and will continue to bet on gold and physical assets.

“The new Bond King”, DoubleLine Capital CEO Jeffrey Gundlach advises investors to stick with bets on precious metals and a weak U.S. dollar, believing this theme will continue to be effective in the future. He stated that the dollar will face structural weakening, a trend unlikely to change even with economic slowdown, because long-term debt concerns and the pressure of debt servicing will continue to weigh on the dollar.

In an interview with CNBC on Wednesday, Gundlach said his portfolio has performed well over the past two years, mainly thanks to staying with the themes of a weakening dollar, strengthening precious metals, and outperformance of foreign markets. He recommends investors allocate 30% to 40% of their stock holdings to non-dollar markets and expects this strategy to continue delivering returns.

The "new Bond King" also pointed out that President Trump and Treasury Secretary Bessent’s calls for rate cuts will only further depress the dollar and translate into inflationary policy. Earlier this week, the ICE Dollar Index fell to a four-year low, down 2% so far this year and over 10% for the past twelve months.

Meanwhile, gold and silver each hit new highs on Thursday, topping $5,500 and $118 per ounce respectively.

Structural Weakness of Dollar Becomes Core Theme

Gundlach said he positioned his portfolio around the core concept of structural weakness in the dollar about two years ago. "Even if the economy weakens, the dollar will also be weak because it triggers concerns over long-term debt. As debt servicing issues emerge, we’ll continue to see dollar weakness," he said.

Emerging market stocks and bonds have performed especially well. Gundlach noted that these indices not only outperformed the market, but as a U.S. dollar-denominated investor, currency conversion gains can be achieved when the dollar weakens. He suggests allocating 30% to 40% of stocks to non-dollar markets; while he wouldn’t go as high as 70%, he expects this will continue to be a successful trade.

Federal Reserve Policy Outlook and Inflation Pressure

After the Fed kept rates unchanged, Gundlach said he would "bet heavily" that investors won’t see further rate cuts during Chairman Powell’s term, which ends in May. Powell cited economic improvements as his reason for keeping rates stable.

Gundlach believes Powell deliberately emphasized that inflation is slightly higher but not as serious as months ago, and that the unemployment rate is not rising in any meaningful way, supported by modest job growth with little increase in the labor force. He pointed out that calls for rate cuts from Trump and Treasury Secretary Scott Bessent will only drive the dollar lower and translate into inflationary policy.

Physical Assets Preferred over Speculative Concepts

In June 2025, Gundlach increased his personal holdings in gold mining stocks and land, calling the timing "very fortunate". He emphasized that physical assets remain key in protecting investors from currency volatility.

Gold is up 90% over the last twelve months while Bitcoin has weakened, a contrast he thinks is significant. "I believe it’s related to those opaque private markets which seem to be in more and more trouble. Investors are starting to seek real things—they are more interested in physical assets and more sober about speculative concepts. I believe this will be an accelerating trend and it’s already underway," Gundlach said.

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