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By Daniel Adaji
Nigeria’s Eurobond market recorded a noticeable shift in yield movements according to the latest data from the Debt Management Office (DMO).
This shows rising returns on long-term securities, signaling higher borrowing costs for the country in the international debt market.
According to the data obtained by Pointblanknews.com on Tuesday, yields on Nigeria’s Eurobonds climbed across most maturities, with the longest-tenored 2051 bond closing at 9.38 per cent, up from its yield at issue of 8.25 per cent. The increase indicates that investors are demanding higher compensation for holding longer-term Nigerian debt, reflecting global monetary tightening and domestic fiscal concerns.
The report showed that while short-term instruments remained relatively stable, long-term yields rose more sharply, effectively widening the country’s Eurobond yield curve.
The 2025 Eurobond, which is set to mature in November, traded slightly above par at $100.17, returning a yield of 5.75 per cent, the lowest among the listed maturities. In contrast, the 2049 bond yielded 9.21 per cent, and the 2038 issue stood at 8.78 per cent, reinforcing the trend of higher yields at the long end of the curve.
Data from the report also revealed that the 2034 Eurobond was the most expensive, closing at $109.94, while the 2047 Eurobond recorded one of the lowest prices at $85.52, despite both offering similar yields near 9 per cent. The 2031 Eurobond, with a coupon of 9.625 percent, traded at $107.51 and yielded 7.95 percent, suggesting sustained investor interest in mid-term paper.
Market analysts often interpret a widening yield curve as a signal of shifting investor sentiment, where long-term investors demand higher yields due to inflation expectations, fiscal risks, or uncertainty about future monetary policy. In Nigeria’s case, the movement underscores ongoing market caution amid global interest rate volatility and domestic revenue challenges.
Eurobond yields serve as a key indicator of investor confidence in Nigeria’s fiscal management and external debt sustainability. Rising yields typically imply increased risk perception, which could affect the government’s future borrowing costs. However, strong pricing on some near-term bonds, particularly those maturing before 2027, suggests continued confidence in Nigeria’s short-term repayment capacity.
The DMO’s Eurobond data, sourced from Bloomberg, covered fourteen active sovereign issues ranging from 2025 to 2051 maturities, with nominal values between US$700 million and US$1.5 billion. These instruments remain a major component of Nigeria’s external debt portfolio and an important measure of its engagement with global capital markets.