Australian inflation linked bonds sold at negative yield

08 September 2015

 

Ordinary Australian bonds have never traded at a negative yield as many European bonds did in 2015 but in the inflation linked bond market there have now been two instances of a negative yields at an ILB tender. ILBs are bonds that have the capital amount adjusted by the quarterly inflation rate thereby protecting investors from the effects of inflation. Well, that’s the theory. Normally the rate received is a...

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