Eurobond rallies on economic growth forecast

Nigeria’s $500 million of Eurobond yields rallied for the first time in five days after a forecast that the country’s economic growth will accelerate this year and as foreign-exchange reserves increased. Borrowing costs on dollar debt due January 2021 declined three basis points to 4.370 percent as of 11:55 a.m. in London. The naira slipped less than 0.1 percent to 157.35 a dollar.

Nigeria’s economy will probably expand 6.8 percent this year compared with growth of 6.6 percent in 2012, the Abuja-based National Bureau of Statistics said today in an e-mailed report. The foreign-currency reserves of Africa’s most populous country have advanced 6 percent this year to $46.68 billion, the highest since at least 2010, according to Feb. 14 data compiled by the central bank.

“With rising gross domestic product and external reserves as well as decelerating inflation rate, the outlook for the Nigerian economy remains favorable,” Sewa Wusu, analyst at Lagos-based Sterling Capital Ltd., said by phone.

The nation’s inflation rate fell to 9 percent in January from 12 percent in December, the statistics bureau said today.

The yield on the country’s 16.39 percent domestic bonds due January 2022 declined six basis points to 10.78 percent in the secondary market, according to Feb. 15 data compiled on the Financial Markets Dealers Association website.