LONDON, June 9 British government bonds should
benefit from political uncertainty in Britain, while sterling is
likely to remain under pressure, Franklin Templeton's head of
European fixed income David Zahn said on Friday.
Zahn holds a long position in British gilts and manages over
2 billion euros ($2.2 billion) in European fixed income for fund
management firm Franklin Templeton.
He said that while sterling was undervalued, the currency
was likely to continue to be driven by politics, and it could
therefore remain weak.
"Political events over the coming months will be what drives
the currency so we do not have a position in the currency at the
moment," he said.
Voters in the UK dealt Prime Minister Theresa May a
devastating blow in a snap election she had called to strengthen
her hand in Brexit talks, wiping out her parliamentary majority
and throwing the country into political turmoil.
(Reporting by Dhara Ranasinghe; Editing by Jemima Kelly)