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DoubleLine's Gundlach: Rates will be stable for the rest of year

U.S. 10-year bond rates will remain between 2.2 and 2.8 percent for the rest of the year, bond guru Jeffrey Gundlach told CNBC on Tuesday.

"The low in U.S. rates was in July 2012, so U.S. rates are rising. They're just rising very slowly and I think that's going to remain the case for a couple more years," Gundlach, CEO of DoubleLine Capital, said on "Squawk on the Street."

It's unlikely the Federal Reserve will raise rates any time soon, though, Gundlach said. Citing lackluster gross domestic product growth, he thinks Fed Chair Janet Yellen doesn't really want to raise rates.

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"The GDP growth today is actually no different, slightly less than it was in 2012. In 2012 nobody was talking about the economy being too strong; that interest rates needed to rise," he said. "In September 2012 is when we embarked on QE3. Eighty-five billion dollars of bond-buyer per month. I mean if the economy was too weak in 2012 to raise rates and needed stimulus support, why is lower GDP today needing higher interest rates."

Furthermore, U.S. interest rates no longer seem to be as tied to the Federal Reserve as is often assumed, Gundlach said.

"U.S. interest rates seem to be driven not by attitudes so much about the Fed, as people talk about. They seem to be driven more by what's going on with European interest rates," he said. "The thing that's been pulling U.S. interest rates down or what's driving them relative to European rates, they tower over the rates in countries like France."

Indeed, the yield on a government 10-year bond from Italy, Spain, Germany and Japan is lower than the United States, Gundlach said. "It seems like a very easy trade not to own Spanish bonds when you can pick up a higher yield in U.S. bonds," he said.

Another thing, a stronger U.S. dollar has served as another tailwind for U.S. Treasurys, Gundlach said.

"The U.S. has been killing it," he said. "If you're a European investor, it's kind of a no-brainer. You get a higher yield. Not by much, but at least you get a higher yield."

The U.S. dollar will likely continue to gain strength, too, as the U.S. economy is faring better than Europe, Gundlach said. Mounting geopolitical tensions and the possibility of a Scottish succession will lend support to the dollar, he said.

Jeffrey Gundlach, founder and chief executive officer of Doubleline Capital LP.
Scott Eells | Bloomberg | Getty Images
Jeffrey Gundlach, founder and chief executive officer of Doubleline Capital LP.

By CNBC staff.