In the United States, with inflation having peaked in the second half of 2022 and now gradually settling down, there seems to be a growing consensus in the market that the policy interest rate hike cycle is nearing its end phase and interest rates will begin to decline accordingly, so that a major economic downturn can be avoided.
Second, the quantitative easing policy created and maintained a very accommodative environment that supported the recovery of Japanese firms, through the commitment to continue zero interest rates. In particular, bank lending rates and interest rates on corporate bonds continued to decline as a result of the flattening of the yield curve, as well as the gradual decline in credit risk premiums.