MILAN (Reuters) - Pimco’s top investment officer said on Tuesday that he expected to remain “fairly neutral” on Italian government bonds as political parties remained deadlocked on the formation of a new government.
“The economy is going well but there’s political uncertainty,” Dan Ivascyn, Pimco’s chief investment officer, told Reuters on the sidelines of a conference in Milan.
“We’ll keep monitoring the valuations. BTPs (fixed-rate state-issued bonds) have done well over the past few weeks. We expect to remain fairly neutral,” he said.
Since the national elections more than a month ago, Italy’s parties have not been able to form a coalition government. Another round of formal talks with the president are due this week.
Financial markets have so far shown little alarm about the prospect of prolonged political stalemate, one of the euro zone’s most heavily indebted nations.
Reporting by Maria Pia Quaglia, writing by Steve Scherer