Nigeria’s Eurobond market ended the latest trading session on a slightly positive note, with the average yield declining by 1 basis point to 8.30%. The modest shift was driven by uneven investor demand across the curve, as global markets remained on edge ahead of the U.S. Federal Reserve’s monetary policy announcement.
Traders reported mixed sentiment within the African sovereign debt space, especially among Eurobond investors who preferred to stay on the sidelines pending the outcome of the Federal Open Market Committee (FOMC) meeting. Some buying interest was noted in medium- and long-term Nigerian Eurobond maturities, nudging yields slightly lower.
On the global front, yields on U.S. Treasuries were mostly unchanged during Wednesday’s session. The 10-year Treasury note hovered around 4.33% after a sharp decline the day before, reflecting market hesitance ahead of the Fed’s policy direction. The two-year Treasury yield was stable at 3.871%, while the 10-year rose marginally by 0.8 basis points to 4.335%, based on data from Tradeweb.
While the Fed is broadly expected to hold the benchmark interest rate steady within the 4.25%-4.50% band, analysts believe Chair Jerome Powell might hint at future rate cuts, depending on inflation data and broader economic indicators.
Market expectations have been shaped by a combination of political and economic factors, with some policymakers advocating for a more accommodative stance to support growth. Meanwhile, global oil markets posted significant gains, further influencing investor sentiment.
Brent crude surged by $2.62, settling at $72.66 per barrel, while West Texas Intermediate (WTI) climbed $2.57 to close at $69.28. The rally was driven by geopolitical tensions, including renewed pressure from former U.S. President Donald Trump on Russia, as well as renewed optimism over easing trade hostilities between the United States and key economic partners.
Precious metals also gained, with gold prices inching higher as investors braced for the dual impact of Fed policy signals and ongoing U.S.-China trade negotiations. Spot gold rose 0.34% to $3,326.0 per ounce, while U.S. gold futures ended the session 0.43% stronger at $3,681.70.
Commodities and bond markets alike are expected to move in tandem with the Fed’s policy stance in the coming sessions, as investors weigh risk against return in a volatile macroeconomic environment.
