Foreign Investors Bet on Nigeria Eurobond with Nov Maturity
Nigeria’s sovereign Eurobonds rallied on foreign portfolio investors’ positive sentiment, supported by improved local macroeconomic indicators. The yield on the US dollar-denominated borrowing notes fell as its price climbed over increased demand seen across the short and belly of the curve.
Lower yields suggest Eurobond costs for the Nigerian government and other African issuers have eased due to improved macros. At the close of the trading session, the average on Nigerian Eurobonds went down, falling by 6 basis points to settle at 8.39%, according to Cowry Asset Limited.
Market analysts said increased demand for the country’s US dollar bonds was buoyed by strong investor demand across the yield curve amidst sharp US Treasury yield fluctuations.
While the market has priced in Nigeria’s disinflation, trading patterns showed that offshore investors have mixed sentiments about positioning in African issuers. The direction of trading activities reflected immediate sentiment in the market basically, rather than long-term outlook.
This suggests that offshore investors were more cautious. Foreign portfolio investors showed preference for short duration, ramping up Nigerian Eurobonds maturing in November 2025.
The African Eurobond market traded positively during the week, driven by improving global sentiment amid a series of trade-related headlines. Notably, agreements between the U.S. and Japan—as well as the U.S. and the EU—signalled tariff reductions, easing concerns over global trade tensions.
Angola, Egypt, and Nigeria sovereign Eurobonds attracted attention, and Ghana witnessed some sell pressures that pushed its yield curve higher. The Nigerian Eurobond segment maintained a mildly bullish tone, with steady buy-side activity across the curve despite intermittent profit-taking.
Broad-based yield compression followed, leading to a 22 bps week-on-week decline in average yields. The August 1 deadline on U.S. tariffs and potential trade agreements with key partners is expected to influence market direction. # Foreign Investors Bet on Nigeria Eurobond with Nov Maturity SEC Elaborates on ‘No Objection’ Approval for First Holdco Share Sale
