Are we nearing the end of the negative bond yield era?

As inflation gets going, the era of the negative bond yield – that investors have to pay governments for the privilege of lending them money – might be coming to a close. John Stepek looks at what it all means.

German Reichstag
The yield on the German ten-year Bund – long negative – is rising fast.
(Image credit: © Getty Images)

One of the greatest financial anomalies of the post-2008 era has been the rise of the negative-yielding bond. The idea of a lender paying the borrower, rather than the other way around, seems to turn everything we assume about finance on its head.

Yet with inflation stirring, the era of the negative bond yield might be drawing to a close. And that promises to bring its own headaches. Particularly within the eurozone.

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John Stepek

John Stepek is a senior reporter at Bloomberg News and a former editor of MoneyWeek magazine. He graduated from Strathclyde University with a degree in psychology in 1996 and has always been fascinated by the gap between the way the market works in theory and the way it works in practice, and by how our deep-rooted instincts work against our best interests as investors.

He started out in journalism by writing articles about the specific business challenges facing family firms. In 2003, he took a job on the finance desk of Teletext, where he spent two years covering the markets and breaking financial news.

His work has been published in Families in Business, Shares magazine, Spear's Magazine, The Sunday Times, and The Spectator among others. He has also appeared as an expert commentator on BBC Radio 4's Today programme, BBC Radio Scotland, Newsnight, Daily Politics and Bloomberg. His first book, on contrarian investing, The Sceptical Investor, was released in March 2019. You can follow John on Twitter at @john_stepek.