Of the country sample tracked by ETM Analytics, seven of the ten highest local currency sovereign bond yields are from Africa. Zambia and Ghana have the highest average local currency bond yields, reflecting the significant fiscal risks associated with both countries against the backdrop of significantly tighter global financial conditions and an ongoing global inflation crisis.
Ghana tops the list of the highest yields on offer, with average local currency bond yields sitting north of 34 percent. Yields across Ghana’s local currency bond curve have surged in recent months, with yields on the long end of the curve climbing by more than 1,400bp since the start of the year. Significant currency weakness and soaring inflation have added to the upside impetus facing Ghanaian bond yields.