The fund manager at UBS Asset Management plans to sell 10-year US Treasury bonds at a high next year, betting on the widening of the spread between short-term and long-term interest rates.

Kevin Zhao from UBS Asset Management plans to take advantage of the significant rise in the 10-year US treasury bonds next year and sell, believing that the dovish Federal Reserve and efforts by US President Trump to stimulate growth before the midterm elections will reignite inflation. Zhao, who is responsible for active management of sovereign, fixed income, and currency funds at UBS Asset Management, says that the market may start pricing in the risk of a Fed rate hike by the end of next year, thereby weakening the attractiveness of long-term US bonds and causing the spread between long-term and short-term bonds to widen to the widest level since 2021.