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Senegal’s Dollar Bonds Rally as IMF Mission Meeting Lifts Sentiment
August 22, 2025
Senegal’s dollar bonds have rallied for the second straight day, fuelled by optimism ahead of an IMF visit. The focus is on addressing the fallout from last year’s revelation that the previous government misreported financial data and concealed $7bn in borrowing. This led the IMF to suspend a $1.8bn loan and triggered a downgrade by S&P rating to B-, sparking a selloff across Senegal’s debt. Investors now hope the IMF will grant Senegal a waiver which could reopen the door to a new lending program. This could be a critical boost to Senegal government’s recovery plan, which includes raising XOF 5.7tn ($10.1bn) over three years, cutting budget deficit to 3% of GDP from 14% by 2027, and rebasing its economy to help restore debt sustainability. Analysts estimate that an economy rebase could lift Senegal’s GDP by 15-25% and push debt-to-GDP below 100% vs. 119% in end-2024. Analyst have cited concerns of a solvency crisis if Senegal does not secure an IMF program in the next 18 months. The Senegal government has however ruled out a debt restructuring and has confirmed opting for extending maturities on some of its borrowings.
Senegal’s 6.25% 2033s have moved higher by 2.5 points since Wednesday and are currently trading at 74.98, yielding 11.74%.
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