Pioneer: Is Germany's AAA now under threat?

Germany's AAA credit rating will come under increasing scrutiny this year as investors shift their focus, according to Cosimo Marasciulo, head of government bonds and FX at Pioneer Investments.

Marasciulo, who manages the €1.45bn Pioneer Euro Aggregate Bond fund with Tanguy Le Saout, said investors may start to question Germany's exposure to peripheral Europe, even as they grow less fearful of peripheral debt itself. Sovereign debt issued by peripheral eurozone nations has rallied sharply over the past six months, bond-buying commitments from the European Central Bank having underpinned investor confidence. Ten-year German bunds are now yielding 1.64%, up from 1.2% last summer, while the likes of Spanish 10-year debt yields - which moved above 7% last summer - have now falle...