Mabrouk Chetouane, the global market strategy manager at Societe Generale, along with Zhuang Bo, the global macroeconomic strategist at Lyxor Asset Management (an affiliate of Societe Generale), shared their latest views on the investment environment and asset allocation strategies. Mabrouk Chetouane pointed out that the markets have shown a relatively muted response to the conflicts in the Middle East and the Russia-Ukraine war. Currently, financial markets are mainly facing stagflation and inflation risks triggered by oil and energy prices. The European Central Bank is expected to cut interest rates in June this year. Despite the ongoing economic recovery, it is not enough to prevent the ECB from lowering rates for the second time. The Federal Reserve is expected to lower interest rates in September, as the U.S. economy still shows resilience and is expected to experience a soft landing rather than recession or collapse. In the coming quarters, it will be difficult for inflation rates to fall back to the central bank's target level of 2%. Maintaining interest rates at current levels and exercising patience has become the new strategy for central banks around the world. Europe has decided to impose new tariffs on different industries to protect its sectors, especially those directly related to climate change and environmental protection (as per the Paris Agreement), such as electric car, battery, and solar panel manufacturers. Concerningly, emerging market countries will also start using similar tariffs to protect their markets. The era of free trade is essentially coming to an end. Zhuang Bo pointed out that Asia is subject to the decisions of the Federal Reserve. The core consumer price index (CPI) of most Asian countries has fallen to close to 2%. However, the "longer-term higher" interest rate policies maintained by Europe and the U.S. have forced Asian central banks to delay rate cuts, resulting in devaluations of various Asian currencies against the dollar. Gold is currently the only commodity reflecting recent geopolitical risks. Not only are individuals buying gold, but the People's Bank of China is also increasing its holdings of gold, further solidifying gold's position as a global safe-haven asset. Mabrouk Chetouane pointed out that China's main partners in the electric car industry are not the U.S., and they are targeting the European market. Since European countries are unlikely to impose huge tariffs on the Chinese electric car industry, the impact of U.S. tariffs on the industry is quite limited. Mabrouk Chetouane recommended continuing to invest in the Japanese stock market, as the yen will continue to be undervalued. Slightly reducing investments in the U.S. market, as the U.S. economy will slow down to a certain extent in the second half of the year. European economies continue to lag behind the U.S., but they may perform well in the second half of the year, especially in core European industries such as banking and energy. In investment portfolios, the tech sector is essential. Today's India is similar to China in 2007, and the Indian economy is expected to make significant progress in the coming quarters. Latin American countries, Mexico, and Vietnam may also benefit from the U.S. tariffs on China.