Nigeria’s sovereign dollar-denominated bonds rose on Tuesday after new President Bola Tinubu declared during his inauguration that a costly fuel subsidy would be phased out and that the central bank should strive toward a uniform exchange rate.
Eurobonds gained up to 3 cents in dollar terms, with the 2029 maturity reaching 87.25 cents. Its 11.43% yield was the lowest since the end of January. On forward markets, the naira currency touched record lows against the US dollar, with the three-month future at 564 naira to 1 dollar, while Nigerian equities rose 4% to a more than two-month high (.NGSEINDEX).
Tinubu, whose triumph is being challenged in court by his primary opponents, inherits a nearly two-decade-high level of debt, foreign exchange, and gasoline shortages.
Nigeria’s debt office said on Tuesday it would sell a new 30-year bond on the local market next month to extend maturity and boost the government’s domestic borrowing.