Greek bonds seen as attractive

Greek government bonds, the highest-yielding in the euro area, may now be safer than Portuguese securities, according to Insight Investment Management Ltd.

The company would consider investing, should Greece proceed with a possible sale of five-year notes in the second half of the year, he said.

As Gareth Colesmith said in his interview, he would be very hesitant in investing in Portuguese bonds, since the Portuguese government is facing serious difficulties in implementing fiscal reforms. Although not a very possible scenario, he said, this may lead to a new haircut in its government bonds, so as to meet fiscal targets.

Colesmith also predicts that the rally in bond markets across in the European periphery, it will slow down progressively this year, with Spanish and Italian bonds outperforming German bonds.