The $7.9 Trillion Pile of Negative-Yielding Debt Is Growing Fast
- Bonds have best December since 2011; JGB yields approach zero
- Markets are worried a recession is on its way, Nissay says
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For all the hand wringing over the end of ultra-loose monetary policy, the world just doesn’t seem able to shake its addiction to negative-yielding debt.
Only two months ago, speculation was rife that the Bank of Japan would have to step in to stop yields from rising. Now, rates on benchmark bonds are poised to drop back below zero. In Germany there are no positive yields as far as seven years along the curve. And globally, bonds with negative yields total $7.9 trillion -- close to levels seen at the start of the year -- and up from the 2017 low of $5.7 trillion reached in October.