Negative interest rates are becoming more and more in vogue and that could be good news for gold.

Last week, Sweden’s central bank plunged a key interest rate even deeper into negative territory. Riksbanken slashed the rate from negative 0.35% to negative 0.50%. Many analysts anticipated the rate reduction, but the magnitude of the cut caught most by surprise.

The Swedish central bank’s move followed on the heels of the Bank of Japan dropping a key interest rate to negative 0.1%. The Japanese bank indicated it was willing to go deeper into negative territory if necessary.

Canadian officials are also talking about negative interest rates, according to the Wall Street Journal.

As we reported recently, negative rate could be right around the corner in the US as well. Janet Yellen said the Federal Reserve is studying the feasibility of dropping rates below zero during congressional testimony last week, saying the central bank should be prepared to take that step of the economy sinks.

According to a Wall Street Journal report, the proliferation of negative rates around the world is good news for gold.

Investors are piling into gold, seeking shelter amid concerns that a turn toward negative interest rates in some countries is threatening to destabilize the global financial system. Gold futures soared 4.45% to $1,247.90 an ounce on Thursday, its highest level in a year…One of the biggest factors behind gold’s rise has been negative rates.”

Negative rates effectively place a tax on savings. Your options are to spend your cash, stuff it under your mattress (or hide it in your microwave as some Swedes have reportedly done), or pay the bank to save it for you. When rates fall below zero, gold become an even more attractive safe haven. As the WSJ explained it:

Gold typically struggles to compete with any yield-bearing investments when interest rates rise, but that disadvantage matters less when borrowing costs are negative, opening the path for more investors to hold the metal. Its rally is another sign of how fearful some gold investors have become that central banks are increasingly powerless to prevent a financial meltdown…”