Group 1 - The report indicates a continued compression of credit spreads, with a notable divergence in performance among different credit types. Short-term credit, particularly short-term perpetual bonds, experienced a slight pullback after a rapid decline in interest rates in early June. Low-rated city investment bonds saw yields decrease by over 5 basis points within a year, while mid to high-grade credit bonds extended their durations, increasing participation in bonds with maturities of 5 years or more [1][10][19] - Institutional buying power for credit bonds has significantly increased, with net purchases reaching a new high for the year. Public funds and other products contributed the majority of this buying, while banks and insurance companies showed relatively weaker support, focusing more on certificates of deposit and local government bonds [2][15][19] - Since mid-May, there has been a slight increase in the primary supply of ultra-long credit bonds (maturities over 5 years), with overall issuance not considered weak. Institutions have shown a higher bidding sentiment for ultra-long credits compared to shorter maturities [3][32][34] Group 2 - Looking ahead, the report suggests that credit bonds with favorable supply-demand dynamics may continue to experience spread compression in a fluctuating interest rate environment. Short-term credit spreads are already extremely compressed, limiting their attractiveness. The central bank's loose monetary policy may allow for some movement in line with interest rate trends, but further compression appears limited [5][44] - For mid to long-term credits, the report anticipates that spreads may still compress, with a preference for bonds with maturities of 5 years or more. The report also highlights the potential for 4-year bonds to provide attractive yields [5][44] - The report emphasizes that ultra-long bonds remain appealing for institutions with stable liabilities, as they offer better coupon advantages compared to interest rates. However, institutions with strong liquidity needs should manage their positions carefully to avoid potential capital loss risks [5][44]