Ringgit sukuk liquidity stays above pre-conflict levels
Fitch's global sukuk liquidity score stood at 62 in early November, below January's reading of 68 despite a recovery since March.
Malaysia's ringgit-denominated sukuk continued to trade with greater liquidity than before the Iran conflict, bucking a weaker global picture, according to Fitch Ratings.
Fitch placed Malaysian sukuk among the most liquid instruments it covers, together with issues from Hong Kong, Indonesia and supranational institutions. Average liquidity scores for these markets ranged from 69 to 95.
Across all sukuk rated by Fitch, average liquidity registered 62 in early November. That matched the October 1 reading but remained below 68 on January 30. The score had recovered about 12 per cent from March's level of 55.
On November 2, about 69 per cent of rated sukuk scored above 50 for liquidity, against a March low of 64 per cent and January's 81 per cent. Euro-denominated sukuk reached a liquidity score of about 81.
Saudi Arabian, Qatari and Kuwaiti sukuk averaged about 57. Fitch said liquidity in those markets had recovered after a brief disruption linked to Houthi attacks in late October, though it remained below January levels.
Fitch expects geopolitical tensions, elevated interest rates and capital shifting from emerging to developed markets to continue influencing sukuk liquidity.
