Pacific Investment Management Company (PIMCO) is scaling down its holding of U.S. and U.K. government debt, Reuters reports. The supply/demand balance for debt in the two countries was likely to suffer as governments increased borrowing, and buying by central banks eventually declined, said managing director of the bond fund, Paul McCulley.

The fund is cautious of corporate debt, but still sees value in selected credits, especially in utilities and healthcare. PIMCO has cut its exposure in U.S. mortgage-backed securities and Treasury Inflation-Protected Securities. Other funds, such as BlackRock, Barings Asset Management and Standard Life Investments, are also wary of the U.S. and U.K. government bond markets, adds Financial Times.

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