Schroders Global believes that with the continued decline in inflation rates around the world and the Federal Reserve's hint at a possible rate cut in 2024, more and more people are hoping that interest rates have peaked. The recent decisions by the Federal Reserve and the Bank of England to maintain interest rates in the 5.25% range reflect the possibility that current interest rates may have peaked. Now is a good time to hold on to risk assets, as long as central banks around the world achieve their soft landing goals and economic growth stabilizes, this will continue to support the category of risk assets. However, perhaps it's time to look for investment opportunities in areas that performed poorly in 2023. Therefore, if interest rates have peaked and growth is stabilizing, now is a good time to consider investing in value stocks and small-cap stocks outside the United States, as these sectors that have been neglected by the financial markets in the past are likely to perform well in this environment. Schroders Global believes that interest rates appear to have peaked due to improvements in inflation, as inflation rates have significantly decreased globally. In the United States, inflation was around 9% a year ago, and is now around 3%. The improvement in inflation in Europe has been even greater, dropping from around 10% to below 3%. In the UK, inflation has also significantly decreased, although it is still in the 4.5% range, which is a significant improvement compared to over 10% earlier. Therefore, it is believed that central banks have fulfilled their duties, and financial market expectations indicate that multiple countries around the world will implement rate cuts in 2024. The bank pointed out that for the United States, the first rate cut is expected to take place in September 2024. The European Central Bank and the Bank of England are not only concerned about the decline in inflation, but also about the relatively weak economic activity and the rising risk of economic recession. Therefore, the European Central Bank may cut rates as early as March, and the Bank of England may cut rates in May. While interest rates are likely to have peaked, the speed at which rates will decrease may vary by country. Schroders Global stated that inflation in the United States has peaked, and financial markets (including stock and bond markets) are responding accordingly. Therefore, there is a positive correlation with the peaking of interest rates. However, interest rates will not remain at the same level, and it is expected that central banks around the world will cut rates in 2024. The impact of rate cuts needs to be factored into the pricing of financial markets. If rate cuts are due to economic growth declining faster than inflation, it will be a problem. In this type of economic environment, stock market performance usually suffers while the bond market performs well. However, there is currently not enough evidence to support this argument, which is also one of the reasons why global central banks are expected to cut rates later in 2024. Additionally, Japan's policy direction is contrary to other countries around the world, as Japan's interest rates have not peaked and are expected to continue rising. The Bank of Japan has recently signaled that they are preparing to raise rates. However, the Bank of Japan is unlikely to raise rates before the spring of 2024, as they hope for inflation to continue to rise.