On his visit to Brindisi in Southern Italy on June 14-15, 2008, Pope Ratzinger appeared in public under a rainbow flag, displayed along with the Vatican flag, above.
Even though the rainbow is a well-known symbol of the homosexual movement, Fides - the press agency of the Congregation for the Propagation of the Faith - chose that symbol as its own. This rainbow flag is stamped with the word Pace [peace in Italian]. Indisputably, it sends a mixed message. It can very well be interpreted as an endorsement of the Vatican and the Pope for homosexuality.
It is interesting to note that Benedict XVI seems quite at ease under that symbol.