About $2.1 trillion in negative yielding debt has been issued so far in 2019, on pace to almost double 2018's issue. The debt issuances are led by sovereign issuers, which have already issued $300 billion more than the year before. Corporate bonds made up about 15% of the total issuance, and issuers have seen a rekindled interest from investors that view their bonds as safe bets considering forward market expectations.
The surge in issuance comes from falling government yields, some which are already negative in the European Union, and sentiments from the Federal Reserve that are drifting toward a return to easing monetary policy. The ultimate goal of a more lax monetary policy is to spark private investment and thus economic growth and inflation. However, falling yields drive up the equity premium over bonds, making the latter much less attractive.
The majority of the debt matures between three and 10 years, with yields between zero and -1%.
