Pimco sells down treasuries in view QE2 will have little impact

Pimco, the manager of the world's largest bond fund, has been selling down treasuries as it expects a second round of debt purchases by the Federal Reserve to have limited impact.

Chief operating officer Douglas Hodge told the World Knowledge Forum in Seoul that the market was clearly anticipating further action from the Fed, Bloomberg reports. "The challenge right now is the breadth of policy measures that can be taken by the US is rather limited," he says. "Even if the QE process is large and rates decline further, in our view we're approaching the end of the bond market rally," Hodge says. "From where we sit, it is very hard to suggest there's going to be that kind of price appreciation that we have seen in bonds over the last 12 to 24 months. "We have...