Bond king Jeff Gundlach predicts oil will top out at $200 a barrel this year as the US battles stagflation — and shares how investors should position their portfolios as the risk of a recession has gone up ‘substantially’

Caught in between skyrocketing commodities prices, turbulent financial markets, and 40-year-high inflation, the Federal Reserve is “in a really difficult position,” said Jeffrey Gundlach, chief executive of DoubleLine Capital.

The problem is that inflation, as measured by the Consumer Price Index, rose 7.5% year-over-year in January, its fastest surge since 1982. But short-term interest rates remain artificially low. For example, the yield on the benchmark 10-year US Treasury note sat at around 1.87%, as of Tuesday afternoon.