Schroders global unconstrained fixed income investment team believes that in addressing inflation and implementing a more accommodative interest rate environment, "patience is a virtue". In the past month, the team has increased the probability of achieving an "economic soft landing" in 2024 to the highest level due to significant improvements in U.S. inflation data. This has reduced the risk of an "economic hard landing". Due to the overall improvement in the economic situation, the risk of a "hard landing" is low. The major central bank meetings around the world have concluded smoothly without any surprises. The European Central Bank (ECB) has started a new round of accommodative policy, a decision that was already anticipated. However, due to the continued high service sector inflation in the euro area and the current economic rebound, it is expected that the ECB will adopt a cautious approach going forward. Meanwhile, the Federal Reserve has adjusted its interest rate forecast, currently expecting one rate cut in 2024, below the earlier expectation of two cuts. Yet the committee's "mainstream forecast" still indicates two cuts, consistent with the forecasts of eight members. So what factors have led the team to further increase the probability of the U.S. economy achieving a "soft landing"? In short, it is the signs of easing inflation pressure. Despite considering a range of economic data, the trend of U.S. inflation is undoubtedly one of the most crucial factors. After all, a decrease in inflation rate is essential for achieving an "economic soft landing" as it creates conditions for the Fed to ease policy. The May U.S. Consumer Price Index (CPI) showed some encouraging signs, with service sector costs excluding housing (the so-called "super core" inflation) showing significant improvement during the month. In fact, service sector inflation has begun to decline compared to the previous month. 2024 saw the highest global voter turnout in history (over 2 billion people), reflecting the ongoing possibility of political instability. However, it is difficult for investors to predict the continuous series of unexpected surprises in both developed and emerging markets. France's fiscal challenges have led to a drop in local government bond valuations, and the sudden announcement of a presidential election has further intensified financial market pressures. Currently, European assets have not fallen to a level that presents a buying opportunity, but the uncertainty surrounding the economic outlook cannot be ignored, with the possibility of significant changes in France's political situation. However, this downturn is expected to bring investment opportunities. Due to the higher likelihood of a "soft landing" in the U.S. economy, it is difficult for the global bond market to see a structural rebound from its current levels. In terms of asset allocation, preference is still given to secured bonds over other credit categories, including bonds issued by international organizations and other government bonds. However, unlike U.S. government-backed mortgage-supported securities, due to ongoing political risk factors, there is less inclination to rely solely on these bonds to improve valuations when deciding to increase investments in such assets. In terms of corporate bonds, a preference continues for European investment grade bonds over U.S. investment grade bonds, but a cautious approach will be maintained due to ongoing political risks.