ZURICH, June 5 (Reuters) - The yield on short-term Swiss federal debt turned negative again and hit its lowest level since September at an auction on Tuesday as anxiety about the euro zone’s debt crisis drove investors to pay to park their funds in the safe haven.
The yield on three-month bills fell to -0.75 percent from 0.62 percent a week ago. It was the lowest since an auction on Sept. 13, when the yield hit -0.801 percent. Unpriced bids came in at 222 million Swiss francs, the highest since December.
The latest worries about Greece and Spain have driven up demand for Swiss franc-denominated assets and prompted questions about whether the Swiss National Bank can defend the cap of 1.20 per euro it set on the franc on Sept. 6.
Risk aversion has also led to a rise in the amount of cash banks hold with the central bank, and has pushed various money market rates - including interest rate futures <0#FES:> - into negative territory. (Reporting by Catherine Bosley; Editing by Ruth Pitchford)