Sukuk market liquidity shows signs of recovery amid ongoing conflict: Fitch Ratings
RIYADH: The liquidity levels of most Fitch-rated sukuk are improving, signaling a gradual stabilization in the Islamic bond market following disruptions caused by the Iran war, according to the credit rating agency.
In its latest report, Fitch Ratings warned that sukuk liquidity has not recovered to pre-Iran war levels in most instances and is likely to remain constrained as long as the conflict persists.
Fitch-rated investment-grade sukuk remains more liquid however, with an average liquidity quantitative assessment score of 66 as of June 9, up from 64 in March and compared to 72 in January.
The outbreak of the war triggered a notable deterioration in the sukuk market liquidity. Heightened investor risk aversion, reduced trading volumes, and broader market volatility led to sharper declines earlier this year.
