Riskoff Sentiment Provokes Surge in Nigerian Eurobonds Yield
The Nigerian Eurobonds yield rose slightly due to foreign investors’ riskoff sentiment in the international market. Bearish sentiment across Nigeria’s sovereign Eurobonds market, covering short-, mid-, and long-term maturities, led to a 0.03% increase in the average yield, closing at 9.08%.
There is an expectation of possible shift in monetary policy following a sharp decline in headline inflation. Analysts said interest rate hike in near impossible at this time due to the need to keep economic growth on track. Policy rate cut or hold are more visible as real returns on naira assets become positive with interest rate standing above inflation.
This could attract foreign investors into the debt market, analysts said, noting that US dollar inflows into Nigeria could pop. Real return isn’t without downside, analysts from LSintelligence Associates said, saying hot money would likely eclipsed cold financing from foreign direct investors.
“Smart foreign investors would give preference to portfolios than facing tough operational challenges in the economy’ The Eurobond market closed on a weaker note as risk sentiment weighed on the market following President Donald Trump’s comments on potential 25% tariffs on automobile and pharmaceutical imports, with a formal announcement anticipated by April.
The possibility of escalating trade tensions added to broader market uncertainty, while hopes for a resolution to the Ukraine conflict were tempered by the absence of Kyiv and European representatives in U.S.-Russia negotiations. Overall, the average mid-yield for benchmark Nigerian Eurobonds increased by 3 bps, ending at 9.03%.
Analysts spotted sell pressures on the Nov-25 and Nov-47 maturities recorded notable yield increases, closing at 7.07% and 10.02%, respectively, up from 7.03% and 9.98% in the previous session. Similar bearish sentiment was observed across the curve in Egypt and Angola. DeepSeek Beats ChatGPT in AI, Rivals Stocks Plunge
