Yields on African dollar bonds soared, some to the highest in a year, as the Federal Reserve said it may reduce monetary stimulus in 2013 and as Nigeria started marketing a second sale of international debt, reports Bloomberg.
Fed chairman, Ben S. Bernanke, said on Wednesday the central bank may start reducing bond purchases this year and end the programme known as quantitative easing (QE) in 2014 should risks to the U.S economy abate.
Nigeria’s government started an investor roadshow in Europe, which will conclude in the U.S. next week, to market a prospective second Eurobond issue, according to a person with knowledge of the plans.
The increase “sounds like a reaction to the Fed meeting on Wednesday and concerns about the tapering of QE,” Shilan Shah, Africa economist at
London-based Capital Economics Ltd., said by phone. “There have been instances of countries delaying issuing Eurobonds simply because of market volatility.”
