Axa IM's Iggo: Greek govt bonds tempting with 15% yield

Greek government bonds yielding 15% are now ‘tempting' as the chances of the country being forced into a restructure over the next couple of years has been reduced, says Chris Iggo at Axa Investment Managers.

The firm's CIO of fixed income says the message from the EU is seemingly to buy one to three year Greek government bonds, based on changes made to the European Financial Stability Facility over a week ago. The EU agreed to lower the funding cost on the Greek bailout loan by 1% and to extend the maturity, as the country attempts to meet its demanding fiscal targets. Iggo adds the EU has officially sanctioned a reduction in the gap between the funding cost of the debt and how much higher this is than nominal GDP growth, a reduction which improves debt dynamics. "It may also mean that...