That floating rate note issues are proliferating and their maturities lengthening as investors appear to seek more protection from rising interest rates is not surprising. It is a surprise, however, this is happening as much in the euro-denominated market, where there is no rates increase on the horizon, as in the US, where there is.

The rate of interest paid on a fixed-rate bond remains the same until the bond matures, so if interest rates or inflation go up in the meantime, investors can suffer negative returns.