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Euro zone’s pool of negative-yielding debt shrank in Dec – Tradeweb

The pool of negative-yielding government debt in the euro zone shrank last month, as investors ramped up global rate hike bets and looked past a surge in the Omicron variant of the coronavirus, Tradeweb data showed on Tuesday.

The pool of negative-yielding government debt in the euro zone shrank last month, as investors ramped up global rate hike bets and looked past a surge in the Omicron variant of the coronavirus, Tradeweb data showed on Tuesday.

The value of negative-yielding euro-denominated government debt stood at around 5.1 trillion euros ($5.8 trillion) at the end of December, down from around 6.2 trillion euros a month earlier, the Tradeweb data showed.

Negative-yielding debt comprised 56% of a total government bond market in the euro zone worth over 9 trillion euros on the Tradeweb platform, versus 67% a month earlier. This was the lowest share since October.

The pool of negative-yielding British government bonds stood at around 717 billion pounds ($969 billion) as of end-December. That was roughly 28% as a share of a total market worth 2.58 trillion pounds, little changed from the previous month, Tradeweb data showed.

Government bond yields have risen in recent weeks as investors bet that the Omicron COVID variant will not significantly derail the global economy or central bank efforts to wind down massive stimulus.

The share of negative-yielding euro-denominated investment-grade corporate bonds was little changed at end-December at around 26% of a total market worth 3.7 trillion euros, Tradeweb data showed.
Source: Reuters (Reporting by Dhara Ranasinghe)

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