Heat the olive oil in a large skillet over medium heat. Add the onion, and bell pepper. Cook, stirring often, until softened, 6 to 8 minutes.
Add the garlic, salt, oregano, chili powder, and nutmeg. Cook until fragrant, sitting occasionally, about 1 minute. Add the tomatoes and cook for 1 minute, stirring occasionally. Add the pumpkin purée and stir to combine. Simmer for 5 minutes, then remove it from the heat.
Carefully transfer the mixture to a blender. Add butter, balsamic vinegar, and freshly ground black pepper. Blend until smooth and creamy.
Stir into freshly cooked pasta or gnocchi. Garnsih with freshly grated Parmesan and chopped parsley on top.
Notes
Make it dairy free or vegan: Omit the butter or blend in olive oil instead. Use vegan Parmesan or omit it.