The bank now expects the 10-year US Treasury yield to end the year at 1.5pc, down from a previous forecast of 2.1pc.

It was trading at around 1.75pc on Tuesday.

On Monday, longer-dated Treasury yields recorded their steepest one-day drop in more than 14 months as investors scooped up low-risk government debt due to a worsening trade conflict between China and the United States.

HSBC also lowered its forecasts for German bond yields, predicting the 10-year Bund yield would end the year at minus 0.8pc from minus 0.2pc previously. The Bund yield is trading at around minus 0.5pc.

The British bank said it expected US and German 10-year bond yields to hit the same levels at the end of 2020 too.