Top performing European bond manager Paul Gagey believes the possible introduction of a common euro bond is a positive move for the EU and will enhance links between eurozone countries.
The chairman of the Eurogroup committee of eurozone finance ministers and current Luxembourg prime minister, Jean-Claude Juncker, was quoted at the weekend by German press in reports saying he was putting forward a proposal for a common euro bond. He described the plan as an ‘intelligent way to keep economically weaker euro countries attractive for investors in the future’.
Paris-based Gagey, the manager of the Aviva Sécurité Europe fund, backs Juncker's plan, saying its introduction would further strengthen existing collaboration between the eurozone economies.
‘There already exists an environment of interconnectivity between eurozone members’, told Citywire. ‘We have already refinanced countries in the eurozone, an example is the ECB which has been buying Greek and Irish bonds. It could go even further but it won’t happen overnight.'
High ranking politicians such as German Chancellor Angela Merkel were critical of the idea when it was first proposed by European Union President Herman von Rompuy earlier this year.
Gagey said he was not surprised by Germany’s reaction as the EU’s economic powerhouse was certain to ‘lose out’ in this scenario.
He is currently ranked third in the three-year fund manager rankings European bond sector for the performance of his Aviva Sécurité Europe fund which has returned 22.57% over the last three years while the Citigroup European WGBI benchmark rose 18.68%.