D’Orsay added his own data from Europe to this rosier picture, starting with a repricing of the yield curve. At the end of 2021, 41% of the European fixed-income universe had negative yields, he said. Now, seven months later, there are no more negative yields. In addition, less than 10% of the universe that was above 1% at the end of ’21, and now 98% of the fixed income universe, is above 1%.

“It’s massive repricing that has not been seen in the last 25 years, neither in terms of magnitude, nor in terms of speed,” he said. “There is an alternative to equities to be found in fixed income, and it’s time to diversify again.”

Aside from the yield curve, real return rates have stabilized, he said, to the point where there are 200 basis points between the first quarter of this year and the beginning of the third quarter. “We’re back to levels we haven’t seen for the last 10 years.”

That decade-in-the-making reset can also be seen when looking at the cost of bonds versus equities. “Bonds are looking cheaper than equity than they used to, as the spread between dividend rates and interest has narrowed over the last three years,” he said. “Here, too, we are back to the levels that we had 10 years ago.”

Given ongoing volatility and continued slow growth or even recession, Amundi is favoring the safest assets of the fixed-income world—sovereign government bonds and investment grade bonds, and the inflation-protected bond market, but no big high-yield plays, D’Orsay said. In terms of duration, he said he favors five- and 10-year maturities.

“The good entry point is to invest when a bond is at least above 140 [basis points] in terms of yield on the 10-year maturities,” he added, giving a clue to good timing under current conditions.

Syzdykoc said emerging markets still represent value, especially with regard to China, and they are countercyclical to the slowdowns in Europe and Eastern Europe.

“Not so much a diversifier, emerging markets are all about a carry play and there are interesting opportunities at it stands now,” Syzdykoc said.

While there have been some downsides in the strength of the dollar and the cost of inflation for food and fuel, Syzdykoc said that value in the emerging markets worlds is more on the high-yield side of the bond market, not investment grade. Still, there are limits, and he said had won’t drop below BBs.

“Of course, the different pockets of the emerging world offer different values,” he said. “But the opportunity for carry is significant in the stable core markets.”