According to BlockBeats, UBS interest rate strategists have expressed optimism about 10-year U.S. Treasury bonds, citing ongoing economic growth risks. They believe the market is underestimating the potential for an economic slowdown, and the relatively moderate U.S. CPI data from May and June is expected to support the performance of these bonds. Despite an increase in household inflation expectations, this has not yet led to significant wage pressure.
Additionally, the strategists mentioned that if the U.S. Senate makes adjustments to the "Beautiful Act" proposed by the House, further spending cuts could alleviate concerns about the widening fiscal deficit. However, UBS also noted that it might be challenging for the 10-year U.S. Treasury yield to fall below 4% in the coming months.