Prime Minister Mariano Rajoy’s battle to rebut corruption allegations is adding to the risk of holding Spanish government debt, said Andrew Bosomworth, managing director at Pacific Investment Management Co.
Europe risks a return to economic crisis as Prime Minister Mariano Rajoy of Spain faces corruption allegations and Italy’s Silvio Berlusconi gains in opinion polls, Goldman Sachs Group Inc. economist Jim O’Neill said.
Targeted asset purchases by the European Central Bank to combat deflation risks would pose difficulties in implementation, Andrew Bosomworth, Pacific Investment Management Co.’s Germany director, wrote in the Financial Times Deutschland.
The European Central Bank may have to take losses on its Greek sovereign bonds because the country is unlikely to repay its debt in full, Andrew Bosomworth, managing director at Pacific Investment Management Co. said.
Greece still faces a “substantial” default risk as insolvency prevents the nation from repaying its debt when its bailout program expires in three years, Pacific Investment Management Co. fund manager Andrew Bosomworth said.