Nigeria’s sovereign Eurobonds witnessed a steep rise in average yields, inching closer to the 11% mark on the back of mounting sell pressure from global investors. The surge comes as asset managers and foreign portfolio investors offload holdings in favour of lower-risk investment vehicles.
Investment analysts noted that rising protectionist policies, particularly from the United States, have forced a reconsideration of trade globalization, with nearly 180 countries now facing elevated tariffs under the Trump administration.
Throughout last week, bearish sentiment gripped the Nigerian Eurobond market across all maturities—short, medium, and long-term. This was particularly evident in the significant selloffs seen in bonds maturing in September 2028 and March 2029.
According to AIICO Capital, African Eurobond markets were broadly impacted by a risk-averse climate fueled by deteriorating trade relations and falling oil prices. The announcement of broader U.S. tariffs triggered panic, prompting investors to abandon high-risk assets—including Nigerian debt—in favour of safer alternatives.
Midweek saw the most severe market decline in recent memory. The introduction of sweeping U.S. tariffs led to renewed fears of a global recession and sent oil prices tumbling. These developments contributed to a dramatic selloff in Nigerian Eurobonds, leading yields to climb sharply.
Global market turmoil intensified when China retaliated with a 34% tariff on American imports. As the week progressed, the flight to safety accelerated, further pressuring Nigerian debt instruments. Consequently, the average yield on Nigeria’s Eurobonds jumped by 118 basis points week-on-week to close at 10.77%—the highest in six months.
Analysts said that heightened geopolitical tensions, increased oil production, and softening demand all point to growing risks globally. These factors have made investors increasingly wary of frontier markets like Nigeria, prompting a widespread shift towards safer asset classes.
The pessimistic outlook was further reinforced by news of OPEC+’s decision to raise oil output by 411,000 barrels per day, alongside Trump’s tariff threats. These factors collectively dampened investor appetite for riskier debt instruments.
TrustBanc Financial Group Limited noted that yields saw sharp increases across multiple tenors, with the November 2027 and March 2029 bonds recording respective jumps of 174 and 158 basis points.
Market participants expect this negative sentiment to persist unless positive signals emerge either domestically or from the global economic environment.
