Nigeria’s US Dollar Bond Yield Slumps to 9.85%
The average yield on Nigeria sovereign Eurobonds slumped due to increased buying interest which caused quoted prices of the country’s US dollar papers to surge in the international capital market.
Nigeria’s US dollar bond have seen raft of buying interest lately following European Central Bank (ECB) recent rate cuts, and expectation that the US Fed would toll the same line in the third quarter of 2024.
Bank of England is expected to meet with a mixed rate cut expectation. Though some analysts are of the view that ECB has laid the foundation for other global central bankers to follow. Investors reckon the Bank is highly unlikely to cut interest rates in an election campaign.
According to fixed interest securities traders at Cowry Asset Management Limited there was positive sentiment in Nigerian Eurobonds. The market recorded buying interest across various maturities, particularly impacting the NOV-25, SEP-38, and FEB-30 Eurobonds.
The firm said in its update that yields for these Nigeria US dollar bonds decreased by 17 basis points, 14 basis points, and 15 basis points, respectively, leading to a 12 basis points drop in the average yield to 9.85%.
In the local market, Federal Government of Nigeria (FGN) Bonds was subdued, with investors exiting positions in the MAR-25 and JAN-26 FGN Bonds instruments.
The selloffs moves caused yields to decrease by 4 basis points and 2 basis points, respectively. Despite these movements, the average secondary market yield held steady at 18.75% compared to the previous close, traders stated.
U.S. bond yields continued to fall as investors became more optimistic that the Federal Reserve will cut interest rates later this year. The yield on the 2-year US Treasury was 4.68%, down 2.2 basis points.
The yield on the 10-year US Treasury was 4.21%, down 3.7 basis points. The yield on the 30-year US Treasury was 4.36%, down 3.4 basis points.
UK 10 Year government bond yield decreased to a 4-week low of 4.10%. Over the past 4 weeks, United Kingdom 10Y Bond Yield gained 3.86 basis points, and in the last 12 months, it decreased 27.50 basis points. Oil Prices Decline over Uncertain Demand Outlook
