Nigerian Eurobonds Yield Eased to 9% on Disinflation
Foreign portfolio investors were all out in the international market for Nigeria’s Eurobond as the country’s statistics office reported a slowdown in the consumer price index for the month of May, 2025.
The Nigerian sovereign Eurobond market recorded strong bullish sentiment, driven by robust demand for the NOV-25, NOV-27, and SEP-28 maturities as disinflation boosts sentiment in the international market.
Fixed income market analysts at Cowry Asset Management Limited said in their investor note that due to bargain hunting on the Nigerian Eurobonds, the average yield declined by 25 bps to 9.00%, reducing Nigeria’s borrowing costs a great deal after it peaked above 11% in the second quarter.
MarketForces Africa gathered that African Eurobonds rallied as investor sentiment rebounded sharply, with risk appetite recovering following easing tensions in the Israel-Iran conflict. The shift away from geopolitical concerns redirected market focus toward this week’s key central bank policy meetings, fixed income market analysts at AIICO Capital Limited said in an update.
Traders hinted that oil-linked issuers, particularly Nigeria and Angola, along with the North African curve, benefited from renewed risk-on flows. Nigerian Eurobonds notably outperformed, with yields tightening with analysts staying positive on bullish sentiment that is expected to continue, albeit moderately, in the near term.
Headline inflation eased to 22.97% year-on-year in May from 23.71% in April, driven primarily by a 111 bps deceleration in core inflation to 22.28%. The moderation reflects a 1.4% naira appreciation last month, according to CardinalStone Securities Limited, supported by sustained CBN FX interventions and easing external pressures following the 90-day US-China trade treaty.
Energy price stability—particularly in PMS and AGO—also contributed to softer energy and transport prints, reinforcing disinflation across core components. Food inflation edged down by 12 bps to 21.14%, benefiting from softer transport costs.
“We expect inflation to moderate further in July, underpinned by continued stability in core components and supported by a stable FX and transport backdrop”, CardinalStone said. #Nigerian Eurobonds Yield Eased to 9% on Disinflation Nigeria Boosts Trade Surplus to N5.17trn as Imports Taper
