Nigeria’s Sovereign Eurobond Yield Rises to 10.6%
Stoked by foreign portfolio investors’ risk-off sentiment, Nigeria’s sovereign Eurobond yield rose in the international market for securities due to broad sell pressures on African papers.
Despite the expectation that the economic growth will remain solid in 2025, supported by reforms, foreign portfolio investors were seen rotating out their positions due to negative sentiment on government earnings.
Data from the Central Bank released showed that federally collected revenue fell by 31% in January, and since then oil put has been under pressure while prices continue to fluctuate.
In search of a safer haven, offshore investors had trimmed down their Nigeria’s sovereign Eurobond holdings, pushing the average yield near 12% before the recent comeback.
On Tuesday, bearish sentiment dominated Nigeria’s Eurobond market again, fuelled by widespread sell-offs across short-, mid-, and long-term maturities.
The Mar-2029 instrument, in particular, experienced heightened selling pressure. As a result, the average yield climbed by 6 basis points to 10.64%, signaling increased market pessimism and downward pressure on bond prices.
Later in the day, the African Eurobond market saw mild recovery supported by rising oil prices, a marginally softer US dollar, and sustained buying interest across Nigerian and Angolan debt, along with select Egyptian papers.
The market is expected to rally on Wednesday as the International Monetary Fund cuts global growth to 2.8% , and keep Nigeria’s GDP growth estimate at 3%
Elsewhere, the local bond market saw steady buying interest across the curve, particularly in the belly, with Feb ’31s and Feb ’34s getting most of the attention. #Selloffs: Nigeria’s Sovereign Eurobond Yield Rises to 10.6% IMF Cuts Global Economic Growth Forecast to 2.8%
