The eurozone’s loss is Denmark’s gain. So desperate are investors to find safe havens away from the eurozone debt crisis that they are paying the Danish government to lend it money.
Denmark is offering negative interest rates on some short term government bonds it has just sold saying it is a “flight into safety” with investors more concerned about getting their money back than the interest they can earn.
Ove Jensen, head of the debt management department at the central bank, said secondary market rates on the bills had been negative since the bank’s last T-bill auction last month. “(But) this is the first auction we have had with negative interest rates,” he said.
“This is proof of investors’ strong confidence in the stabilisation-focused fiscal policy here at home and Denmark’s potential status as a safe haven in a troubled and debt-plagued Europe,” said Nykredit chief economist John Madsen.