Recently, Schroders global wrote that the overall yield of Asian credit remains at multi-year highs, and under favorable market conditions, it is expected that the credit spread will remain relatively stable by 2025. Schroders global pointed out that in 2025, several key factors may make the Asian credit market attractive. Firstly, it is expected that the Asia-Pacific region will continue to be the engine of global economic growth, which will benefit credit fundamentals and help lower default rates. Compared to emerging markets, Asia has a large developed market and the macroeconomic environment in medium-income countries in the region has improved, providing more high-quality investment opportunities. The relatively low leverage in Asian corporate balance sheets and their conservative growth targets further strengthen the credit fundamentals. Secondly, with negative net supply and strong demand in the Asia-Pacific region, the technical aspect remains strong. Expectations of a strong dollar, as well as investors seeking attractive yields in dollar-denominated asset classes, may further stimulate demand for Asian credit. In 2025, as Asian credit yields are expected to remain high for a longer period of time, the spread will continue to be a focus of the investment market. As spreads narrow, investors should carefully select credit products, considering issuers with strong fundamentals and adaptable business models. Overall, Schroders global focuses on holding attractive and high-quality spreads as the cornerstone of their portfolio, while seeking interesting investment opportunities in the high-yield sector. Schroders global prefers investments in the investment grade financial sectors of Australia and Japan, as well as high-yield credits in the renewable energy sector in India and the gaming industry in Macau. Given the increasing corporate governance risks, it is crucial to maintain cautious positions and selectively participate in new credit issuances. Lastly, in terms of interest rates, Schroders global believes that credit markets with shorter yield curves are the most valuable. In the event of continued interest rate fluctuations, Schroders global tends to maintain a neutral to slightly overweight position, while remaining flexible. Compared to most regions, Asian credit benefits from shorter durations, and Schroders global optimistically believes that this asset class can withstand interest rate fluctuations, especially considering the unpredictable inflation concerns sparked by Trump's policies. Schroders global states that there are many events that may impact the credit market in 2025, including various policies of the Trump administration, China's fiscal stimulus plan, and further geopolitical tensions. The main impacts of Trump's re-election on Asia are twofold: 1) tariffs and economic growth; 2) US dollar interest rates and trends. Considering the potential for increased global trade friction and uncertainty, Asia-focused markets or credit issuers may remain resilient. This includes some companies in India, Indonesia, Australia, and Japan. Furthermore, with spreads continuing to widen, the financial sector (an industry that Schroders global mainly overweights in credit strategies) will thrive in the more economically growth- and inflation-friendly US market. Conversely, Schroders global does not favor industries with excess capacity, such as automotive, South Korean batteries, industrial, and petrochemicals. In terms of Chinese credit, many Chinese credits are more resilient compared to Trump's first term, as issuers have clearer positioning, more resilient business models, or supply chains. Therefore, although Schroders global's focus remains on industries of strategic importance that are less affected by geopolitical tensions, such as certain internet platforms, technology, and consumer goods, they will continue to look for investment opportunities that can provide excess returns and market misalignments. Overall, Schroders global believes that investors have good reason to reassess the Asian credit market, as stable fundamentals, favorable technical aspects, and attractive overall yields can adequately compensate for potential market fluctuations in the future. For investors with existing global credit allocations, Asian credit offers the potential for attractive diversification advantages, further enhancing the risk-return potential of a broader investment portfolio.