Causer and Read buy Spanish and Italian debt

Invesco Perpetual star managers Paul Causer and Paul Read recently bought into Spanish and Italian bonds after seeing yields escalate during the European sovereign debt crisis.

The duo, who run upwards of £10bn across a number of IP bond portfolios, added the bonds after spreads widened to "phenomenal" levels through the turmoil earlier in the year. Spanish debt was trading at just 57bp over the benchmark bund yield at the beginning of 2010, but the spread widened to over 220bp during the crisis. The spread has since narrowed to about 180bp. Causer says investor panic during the crisis forced many Governments on the continent to make a number of hard economic decisions, which have had a positive effect on markets. "European governments have done things th...