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Justin Kuepper

Germany's Bond Yields Go Negative

By November 14, 2012

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Investors worried about turmoil in the eurozone are now paying Germany for the privilege of parking their money within its borders, according to a recent Wall Street Journal article.

On Wednesday, Germany auctioned $5.49 billion of a new series of notes, or Schatz, with an average yield of -0.02%, as investors flocked to less risky assets. Unfortunately, the lower yields have driven down savings yields and had a negative impact on millions of German savers.

The move mimics a similar move lower earlier this year when investor concerns arose over Spain's ability to raise funds from the market. But, the ECB's pledge to buy unlimited eurozone bonds led to some stabilization in the market.

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