Islamic bonds dip amid fears of US Fed scaling back
Published 27/06/2013 | 05:00
INVESTORS in Islamic bonds are losing money for the first time in more than three years amid concerns the US Federal Reserve will scale back its bond-buying programme.
Sukuk – funds that are compliant with Sharia law – have experienced their first decline since 2009. Sukuk investors had been benefiting from a boom in Islamic finance, with Ernst & Young forecasting a surge to $1.8trn this year from $1.3bn in 2011.
"We went from a world where there was abundant liquidity to all liquidity evaporating," said investment banker Gus Chehayeb.