Fitch Ratings Expects the Global Sukuk Market to Continue Growing in 2H 2021 and Beyond

Fitch Ratings forecasts Sukuk supply to increase in the second half of 2021 (2H 2021) following strong growth in the second quarter of 2021 (2Q 2021). The global Sukuk market witnessed strong activity in 2Q 2021, led by the Saudi Arabian Oil Company (which marked the largest Sukuk issuance ever by a corporate), as well as sovereign issuances from Indonesia, Turkey and Oman. Growth in 2Q 2021 was driven by strong investor appetite, coupled with refinancing and funding diversification requirements of issuers. Amidst ongoing fiscal deficits and persistent economic challenges, issuers sought to diversify their funding and benefit from the low interest-rate environment.

Why it Matters?

Although quarterly Sukuk issuances are expected to be impacted by seasona...