Nigeria’s Eurobond Yield Sinks to 9.92% -MarketNews

In Nigeria’s sovereign Eurobonds market, positive sentiment prevailed across all segments of the yield curve, causing a marginal decrease in the average yield to 9.92%, Cowry Asset Limited said in its market update.

According to fixed interest securities analysts, Nigeria’s US dollar prices surged following mild demand by foreign portfolio investors and local authorised dealers in the international market.

This dragged the yield on Nigeria’s sovereign Eurobonds lower by 3 basis points to settle at 9.92% as of the end of the trading session on Thursday. The market has lately reversed the sell sentiments following economic cracks –with inflation and naira falling altogether.

Trading activities in the US treasury turned bearish after FOMC January minutes. US Treasury bond yields rose on Friday, as a pair of Federal Reserve officials suggested the central bank was in no hurry to cut interest rates.

The yield on the 2-year Treasury was 4.75%, up 4.5 basis points. Yields move in the opposite direction to prices. The yield on the 10-year was 4.35%, up 2.3 basis points. The yield on the 30-year Treasury was 4.47%, up 1.2 basis points.

In the local bond market, investors are selling 2025 FGN bonds for quick cash after the debt office failed to raise N2.5 trillion from local capital market as envisaged.

Top investment firms in Nigeria have maintained consensus that inflationary pressures are not anticipated to abate in the near term, in addition to higher interest rates globally.

They expect that yields in the fixed income market to remain elevated in 2024 as the monetary authorities double down their efforts to narrow the country’s negative return and incentivise investors.

In the foreign exchange market, the Naira depreciated by 1.86%, closing at N1,571.31 per US dollar in the official market.  The Exchange rate also fell by 0.39% in the parallel market, closing at N1,809 per dollar on Thursday. #Nigeria’s Eurobond Yield Sinks to 9.92% -MarketNews

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