Looking for Positive Yields? Head to the US
July 11, 2016
On the other side of the spectrum you have Japan. Japan accounts for about 28% of the total developed world government debt stock. However, it makes up over 56% of the total negative yielding debt in the developed world. France’s share of negative yielding debt is twice its share of the total debt market. France makes up 5.6% of the all government debt but 10.5% of the negative yielding debt. Same goes for Germany. Germany makes up 3.9% of all developed world government debt but 8.1% of the negative yielding debt.
Switzerland made some headlines last week as its entire yield curve, from 1-month to 30-years, has moved negative. While this is extraordinary, the impact for investors is tiny. Switzerland makes up just 0.2% of the developed world government debt market.
Source: Bloomberg, Gavekal Capital