The average yield on Nigeria’s U.S. dollar-denominated bonds declined as strong demand from foreign portfolio investors lifted sentiment in the international market. Hopes of economic recovery and a sharp drop in headline inflation have spurred appetite for the country’s sovereign eurobond papers—contrasting with the bearish tone seen among some African peers.
Analysts expect Nigeria’s borrowing costs in the global debt market to ease further in the absence of major economic or political shocks, supported by recent credit rating upgrades from Moody’s, Fitch, and S&P Ratings.
In its market note, Cowry Asset Management Limited said Nigeria’s Eurobond segment ended on a positive footing, with the average yield slipping by two basis points to 8.01%, reflecting robust buying interest and stronger investor confidence.
By contrast, African Eurobonds broadly weakened as falling oil prices and heightened U.S. political risk unsettled markets. Analysts at AIICO Capital Limited noted that investors reacted to former U.S. President Donald Trump’s escalating pressure on the Federal Reserve and his threats of fresh trade measures. Trump’s call for the removal of Fed Governor Lisa Cook and his hints at further tariffs and tech export curbs against U.S. trade partners rattled sentiment, raising concerns over Fed independence and global trade tensions.
Last week, Nigeria’s Eurobond curve had closed on a bearish note, with average yields widening by 16 basis points to 8.12% from 7.96% in the prior week. Losses were broad-based, but the 2032 (+24 bps to 8.28%) and 2033 (+21 bps to 8.60%) bonds bore the heaviest selling pressure.
