Trillions of Negative-Yielding Bonds Vanish
- Pool of sub-zero debt at $300 billion, a fraction of 2020 peak
- Traders see borrowing costs turning positive by end of year
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After another wild week in global money markets, traders are betting big on the biggest regime shift in Europe in years: the end of the negative interest-rate era before 2022 is over.
Fueled by a flurry of hawkish monetary signals over the past week, the interest-rate swaps market now projects the European Central Bank will deliver three quarter-point hikes by December -- winding down the eight-year experiment with sub-zero borrowing costs that’s saddled savers with financial repression and helped funnel billions of euros into speculative assets.