Benchmark U.S. yields are poised to climb in the new year as market participants fade their 2019 pessimism about the economic outlook, according to PineBridge Investments.

“The negativity cartel will break around the spring,” Michael Kelly, head of multi-asset at PineBridge Investments LLC, which managed $96.9 billion in assets as of September, said in an interview last week by phone from New York. Ten-year Treasury yields should rise to 2.25% to 2.5% in the first few months of 2020, he said.

Global stock-market valuations are also set to “become even more generous,” supercharged by an improvement in corporate profits alongside the expansion of central banks’ balance sheets, Kelly said.

By comparison with 2016 -- the last time that yields bottomed out as global economic slowdown faded -- Treasury yields may not climb quite so much, according to Kelly. That’s because of central banks’ continuing low-rate policies, he said. Negative interest rates in Japan and Europe have pressed some overseas investors to pile into American securities, which have positive yields.

Ten-year U.S. yields last traded at 2.5% in May, before the Federal Reserve began lowering interest rates and again expanding its balance sheet. They were at 1.89% late Thursday in New York.

Meantime, local-currency emerging market bonds will start to outperform in the spring as recent strength in the dollar gives way to stability, Kelly said. Global demand for positive yielding assets, after accounting for inflation, will also prove a lure for this asset class, he said.