* ECB can start buying below -0.4 pct on Monday
* Amount of debt yielding less than that rose tenfold in
* To see a chart: tmsnrt.rs/2iZH5qU
By Francesco Canepa
FRANKFURT, Jan 2 The number of euro zone
government bonds that yield even less than the European Central
Bank's negative deposit rate rose tenfold last year to some 1.2
trillion euros, or a fifth of a widely used market index, IHS
Markit data shows.
To see a chart: tmsnrt.rs/2iZH5qU
Starting on Monday, the ECB can buy debt yielding less than
its -0.40 percent deposit rate as part of its two-year old, 2.3
trillion-euro money-printing programme aimed at reviving growth
in the euro zone by flooding it with cash.
A negative yield, which means the ECB will get less money
than it paid for the bond if it holds it until it matures,
reflects investor expectations that ECB rates will remain low in
the short term, strong demand for high-rated debt and an
oversupply of cash.
The change to the programme, announced last month, is aimed
at allaying fears the ECB would run out of eligible paper to buy
after yields on short-term debt issued by cash-rich countries
such as Germany, the Netherlands and France fell below the
The three countries account for nearly 84 percent of the 1.2
trillion euros worth of debt yielding less than -0.40 percent on
the iBoxx euro zone sovereign bond index.
The ECB pushed its deposit rate below zero in 2014,
effectively charging banks for parking their excess cash with
the central bank overnight. It last cut the rate in March 2016.
To see more graphic on negative yields click on: tmsnrt.rs/2fPTds0
($1 = 0.9554 euros)
(Graphic by Gustavo Cabrera Cervantes, editing by Larry King)