It really just seems across the breadth of debt markets whether you're talking about government bonds or corporate debt that
we're getting as well level where yields and opportunities are starting to look more enticing.
You're absolutely right Heidi. I mean the investment community has been complaining about yields being too low for too long.
Probably for 18 months. And allow yields have risen spread have widened. So fixed income assets have repriced aggressively under
wraps to year to date. So value started to emerging and in fixed income assets. So we're looking at returns now on fixed income
assets can be quite tame. Let me take Asia for example. If we look at investment grade Asia investment grade corporate yields
are getting really interesting and a 5.1 percent. That's 270 basis points higher than just 18 months ago. Frankly investors
are currently at a much higher starting point now. This is 18 months ago. There's much more cushion for price risk now vis.
Is there appetite for China credits. Or would you need to see some more significant signals to suggest that we're past the
peak of the pessimism. Very weak dollar that we saw yesterday shouldn't be much of a
surprise to the market because the resources have been prioritized to contain coal. But we see mobility and activity
have been restricted to major economic zones in China. Now the near term growth remains quite challenging and I think sentiment
is likely to remain quite fragile. Well we are approaching peak China pessimism for three reasons. One is the latest. The cold
wave appears to have peaked and we've seen this in Hong Kong. Two months after that we peak at a critical fall. So this could
eventually pave the way for a lockdown easing in those two cities in coming weeks. And secondly while monetary policy
remains a moderate fiscal policies are likely becoming more aggressive. And high frequency data
right now show early signs of improvement in infrastructure spending pressure investment and the supply chain. For example
aluminum output actually is at record high. The blast furnace in China is also rhyming at pretty high capacity at the moment. And
of course history is the property. I mean we see that more and more properly easing policies are coming to the market reaching
a critical mass. So we don't need to be too pessimistic here. Right. And I guess it depends on what kind of corporate Shery
Ahn corporation you are whether depressed consumer sentiment after all these lockdowns. We'll see how weak retail sales were
for crying out loud or even business sentiment. It comes to new investment. How that's going to play out. You think defaults are
already priced in. Is there any area where you're especially worried about. And what are you looking for to say. You'd better
take that off the list. Yes you're right. The defaults haven't been priced and therefore
you can see that apparently when there is a headline there's another default headline. The market seems to be quite loose
about its sentiments remains very weak and feels almost like the market is too soft here without any directions to trying to find
directions to here. So. So ask for the market to move forward. I think we need to watch. One is how those restructurings are
proposed and what's the recover values like. And also any differentiated treatment between onshore and offshore holders
and know whether the actual economy is going to recover. Thanks China. What other developing nation credit markets do you see.
Some good picks and you've talked about Asia here. I actually think that ex China high yields which means majority
of those high yield call for it's even in Southeast Asia the India Philippines Indonesia very attractive. They used to trade
actually at Hydro the U.S. high yield in the past on average over the past 15 years. But now they are almost 300 basis points
pickup over U.S. high yield. And those are really high quality coal crates with very strong balance sheet.
So Jenny in terms of central banks and global central banks this is all about the Fed reserve in your mind or when you look to
the Reserve Bank of Australia. When you look to the Bank of Korea which just in your trunk reaching young the new chief just
saying he could see 50 basis point rate hikes. How does that enter into the picture for Asia. Credit markets more broadly.
Yes. Asia has been playing catch up to Fed lately and let many by North Asian countries ex China again. It's China. The slowing
global growth environment means that the external demand conditions for Asia will soften. However we think a domestic
demand will help fill the gap. Help because most of the large Asian economies the media cycle in terms of the expansion and
supported by Schuller reopening. Now of course China yes it's a different story. But now I would just think that we will see
more normalization in terms of policy across Asia. OK.