Foreign portfolio investors have ramped up their holdings of Nigeria’s sovereign Eurobonds, especially those maturing in November 2025, as improved macroeconomic fundamentals lift investor sentiment and trigger a rally in the US dollar-denominated debt market.
As demand surged, the yield on Nigerian Eurobonds dropped by 6 basis points to 8.39%, reflecting rising prices across the short and mid segments of the yield curve, according to Cowry Asset Management.
Analysts say the yield drop points to declining borrowing costs for Nigeria and other African issuers, a positive development supported by easing inflation, external trade pacts, and stabilized local economic indicators.
While the market is pricing in Nigeria’s ongoing disinflation, trading activity indicates foreign investors are adopting a more cautious stance. Recent movements suggest offshore players are gravitating toward shorter-duration securities, with November 2025 bonds seeing the strongest buy-side action.
Activity across the broader African Eurobond market was buoyant during the week. Positive trade developments between the United States and key partners like Japan and the EU contributed to a risk-on sentiment. Angola, Egypt, and Nigeria emerged as top gainers, while Ghana’s bonds faced selling pressure.
Nigeria’s Eurobond curve maintained a mildly bullish tone, supported by steady demand and limited sell-offs. Week-on-week, average yields declined by 22 basis points across the board. Analysts predict that upcoming U.S. tariff decisions—particularly the August 1 deadline—could significantly shape investor direction in the weeks ahead.
