Japan 10-year bond yield goes negative for first time

AFP, TOKYO: The yield on Japan’s 10-year government bond dropped below zero yesterday, in a first for a G7 country as panicked investors flee a bloodbath on equity markets.
The note’s effective return slipped to -0.005 per cent in the afternoon, continuing a downtrend sparked by the Bank of Japan’s surprise move last month to slap a negative interest rate on some commercial lenders’ deposits.
Before the unexpected decision, Japan’s 10-year bond was paying a yield of about 0.2 per cent, similar to the current payout on a comparable German government bond.
By comparison, the United States pays about 1.7 per cent on a 10-year bond while hard-hit Greece must pay a nearly 10 per cent yield on its decade-long notes to attract wary investors.
The decline in the yield—effectively the rate of return for a bond if held to maturity—reflects rising demand for Japanese government debt, and investors’ worries about putting more money into equities.

Japan 10-year bond yield goes negative for first time

AFP, TOKYO: The yield on Japans 10-year government bond dropped below zero yesterday, in a first for a G7 country as panicked investors flee a bloodbath on equity markets. The notes effective return slipped to -0.005 per cent in the afternoon, continuing a downtrend sparked by the Bank of Japans surprise move last month to slap a negative interest rate on some commercial lenders deposits. Before the unexpected decision, Japans 10-year bond was paying a yield of about 0.2 per cent, similar to the current payout on a comparable German government bond. By comparison, the United States pays about 1.7 per cent on a 10-year bond while hard-hit Greece must pay a nearly 10 per cent yield on its decade-long notes to attract wary investors. The decline in the yieldeffectively the rate of return for a bond if held to maturityreflects rising demand for Japanese government debt, and investors worries about putting more money into equities.