Treasury bills are currently offering negative yields. Investors are so risk-averse that they are willing to accept a guaranteed loss in order to protect their principal.

This phenomenon is being driven by fears of deflation, where prices fall and the real value of money increases over time. In a deflationary environment, investors may prefer to hold onto cash or near-cash assets, even if they offer a negative nominal yield, as the purchasing power of those assets is expected to increase.

The demand for treasury bills is currently very high, and investors are willing to pay a premium for the safety and liquidity that these instruments offer.

This is an unusual situation, as investors normally demand a positive return on their investments. However, in times of economic uncertainty, safety and liquidity can become more important than yield.