Nigerian Eurobond Yields Rise Amid Broader African Sovereign Debt Selloff
The average yield on Nigerian Eurobonds increased by 19 basis points to 9.98% in the international capital market, as investors sold off African sovereign debt instruments, reversing gains from the previous trading session.
Market analysts suggest this risk-averse behaviour may be connected to expectations of monetary policy adjustments. There are concerns that the Nigerian government might restrain further interest rate increases, potentially flattening the yield curve and diminishing real investment returns.
However, this selling pressure wasn’t isolated to Nigerian government bonds but represented a broader market response to oil-dependent economies facing uncertainties in global commodity markets, characterised by ongoing price volatility.
Nations like Nigeria and Angola—which rely heavily on oil export revenues—are particularly vulnerable to crude oil price instability. The market is currently processing lower demand growth projections along with the potential impact of the Trump administration’s energy policies.
Recent reports indicate that the US government prefers oil prices in the $40-50 per barrel range, based on global demand forecasts and efforts to reintegrate Iranian exports into the market.
According to Cowry Asset Management Limited, foreign portfolio investors significantly reduced their holdings in Nigeria’s sovereign Eurobond market, creating bearish conditions across all maturity segments.
“This effect was particularly pronounced for the Nov-2025 and Sep-2028 Eurobonds, which played a key role in driving yields down across the market,” the investment firm said.
As a result, the average yield climbed by 0.16% to 9.98% following decisions to reduce exposure to Nigerian government debt. The decline in African Eurobonds continued, driven partly by falling crude prices as potential progress on reviving the US-Iran nuclear agreement raised expectations of increased global oil supply.
Oil-dependent issuers like Nigeria and Angola experienced greater market pressure, with Nigeria’s sovereign yield curve weakening to an average yield of approximately 10%.
However, according to AIICO Capital Limited, some late-session bargain hunting for select discounted bonds helped moderate the selloff before markets closed.
