LONDON May 4 The value of euro-denominated
government bonds in Europe with yields below zero has dipped
below 3 trillion euros, potentially creating a wider pool of
eligible bonds for the European Central Bank's bond-buying
The ECB has a number of criteria for its asset-purchase
programme, aimed at boosting inflation in the euro area, which
includes a ban on buying bonds yielding less than its deposit
Data from trading platform Tradeweb showed 2.9 trillion
euros ($3.3 trillion) of government bonds in Europe yielded less
than zero at the end of April, suggesting investors were still
prepared to pay for the privilege of lending to the most trusted
That still counts as some 41 percent of the 7 trillion euro
market and was down from just over 3 trillion euros two months
Negative interest rates from the ECB and its 1.5 trillion
euro asset purchase programme continue to put downward pressure
on bond yields and on returns for depositors and investors
across the euro zone.
The central bank's plans meanwhile to add top-rated
corporate bonds to its quantitative easing programme from June
has helped drive more corporate debt yields into negative
According to Tradeweb, more than 5 percent of the 2.8
trillion euro-denominated investment grade corporate bond market
in Europe had yields below zero compared with almost 4 percent
in early March.
It said that about 151 billion euros worth of investment
grade corporate bonds had a negative bid yield at the end of
April, up from about 105 billion euros in early March.
While the ECB has not decided how many corporate bonds it
would buy every month, it has said it can buy bonds issued by
companies that are based in the euro zone, have an investment
grade rating and are not banks.
"Overall the pool of bonds with negative yields remains huge
and is still unattractive for investors," said David Schnautz,
interest rate strategist at Commerzbank.
(Reporting by Dhara Ranasinghe; Editing by Raissa Kasolowsky)