The international financial markets are flooded with negative-yielding debt. Today, the total amount of global negative-yielding government bonds stands at $11.4 trillion, says a new report from Fitch Ratings.
According to Fitch, the global amount of negative-yielding debt actually fell from $11.5 trillion to $11.4 trillion because of Japan.
Following the announcements from the Bank of Japan (BOJ) and the Japanese government that they would unleash further economic and fiscal stimulus efforts, Japanese debt yields rose. And the negative-yielding issue isn’t just stemming from government bonds, it’s also coming from the private sector. Approximately $32 billion of bonds were issued by Japanese financial institutions and corporations and are trading with negative yields.
Japan represented more than half of the negative-yielding debt on international markets.
But as the negative-yielding sovereign debt in Japan went down, it went up in Europe. The sum of negative-yielding sovereign debt jumped from $4 trillion to $4.2 trillion.
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