The $10.4trn (€9.2bn) includes $7.3trn in long-term issuance and $3.1 trn in short term.
On April 25, negative-yielding debt was at $9.9trn, the ratings firm said. Since then, slight declines in Japanese, Italian, German and French sovereign yields drove the $500bn increase in the total stock of negative-yielding debt.
“Unconventional monetary policies, regulatory risk mitigation by banks and a flight to safety in global financial markets have all contributed to the ongoing rise in the amount of sovereign debt trading with a negative yield,” the firm said in a report.
“Yields on some Italian securities with maturities between 1.5 and 3 years flipped to negative from positive, and long-dated Japanese securities have gone further into negative territory since April 25.
“Core Eurozone yields were driven lower as weak inflation and manufacturing data, as well as the expansion of the ECB’s bond-buying program, continued to fuel demand for Eurozone sovereign debt.”
Japan remains the biggest issuer of negative yielding debt globally. GAM investment director Tim Love believes Japan’s negative rates have become an “experiment” that signal serious flaws in the policies of Abenomics.