Risk-off Sentiment: Nigerian Eurobond Yield Climbs to 7.30%
the benchmark yield climbed as the Nigerian sovereign Eurobond traded bearish at the international market last week due to risk-off sentiment ahead of inflation data release this week.
Market participants exited their positions as Broadstreet analysts project a significant spike in headline inflation, which will likely keep interest rate at double-digit highs.
The local fixed income market has seen rates repricing, which could be extended to the external borrowing schedule for 2026 on account of a steep surge in the consumer price index and the absence of monetary easing.
Last week, the Nigerian Sovereign Eurobond market traded largely bearish, pressured by profit-taking, weaker oil prices, and subdued global risk appetite.
Market sentiment was supported by lower U.S. Treasury yields and improved investor sentiment—which were short-lived, as fresh concerns about the pace of U.S. rate cuts and the Federal Reserve’s dovish but data-dependent outlook triggered renewed risk-off positioning.
By midweek, investors’ sentiment dipped further amid softer crude prices and expectations of additional oil supply from Venezuela, while U.S. jobless claims data rose modestly to 208k from 200k, pointing to a slight easing in labour market conditions.
Towards the end of the week, oil prices rebounded on concerns over potential disruptions to Iranian supply and ongoing uncertainty surrounding Venezuelan output, offering modest support and driving mild yield compression. Overall, the average benchmark yield climbed by 26bps week on week to settle at 7.30%, according to AIICO Capital Limited. Naira Drops at Official Window as 2026 FX Projections Emerge
