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UBS slashes world growth forecasts, predicts 1% U.S. Treasury yields

LONDON, Sept 4 (Reuters) – UBS on Wednesday slashed its forecasts for world growth and government bond yields on Wednesday, predicting 10-year U.S. Treasury yields — the benchmark for global borrowing costs — would end the year at just 1%.

A bitter global trade war that has hurt world economic growth and fuelled expectations for rate cuts from major central banks has sparked a sharp fall in bond yields this year.

In a note, UBS said it now sees world growth dropping to 2.5% in the coming quarters compared to an annualised 3.2% previously, and cut its U.S. 10-year Treasury yields forecasts by 25 basis points to 1% for 2019 and 1.25% for 2020.

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