Italy

The European Central Bank said last night it would "actively implement" its controversial bond-buying programme to fight the eurozone's debt crisis, signalling it will buy Spanish and Italian government bonds.

The European Central Bank (ECB) has voted to hold interest rates and will boost liquidity in the eurozone in an attempt to prevent the sovereign debt crisis from spreading to Italy and Spain.

Spanish and Italian government borrowing costs have hit eurozone-era highs as investors continue to worry over the state of their respective economies.

Invesco Perpetual remains positive on the prospects for the Spanish economy despite Moody's hinting it may downgrade the nation's credit rating this morning.

EU leaders have agreed a further €109bn (£96bn) bailout for Greece, one-third of which will come from private sector bondholders.

Invesco Perpetual's Paul Causer and Paul Read have allocated nearly a quarter of their £398m Tactical Bond fund to Spanish and Italian bonds in the view the countries are "too big to fail".

Those looking to maximise returns in the first half of the year should have parked their money in Eastern European equity markets such as Hungary and the Czech Republic, according to data from S&P's.

PIIGS STILL A CONCERN FOR EURO CREDIT

Invesco Perpetual star managers Paul Causer and Paul Read recently bought into Spanish and Italian bonds after seeing yields escalate during the European sovereign debt crisis.

RWC Partners has made significant changes to its Global Convertibles fund since the departure of former managers Miles Geldard and Lee Manzi.