Executive Summary
Most major central banks began a rate cut cycle during the second half of 2024, with the trend expected to continue in 2025. In fact, the European Central Bank and the Bank of England have already cut rates during the first quarter of 2025. Trade tariffs from the US have depreciated the US dollar, affecting the return of Global USD based indices. In contrast, Emerging market indices and GCC indices have performed better than their peers during the quarter.
GCC bonds and sukuk primary issuances in Q1 2025 amounted to USD 51.5 billion raised through 125 issuances, a decline of 7.1% compared to Q1 2024. Issuances during the quarter also saw a change in issuance trends, with more corporate bonds/sukuk being issued than sovereign bonds/sukuk (61.3% vs 38.7%). Conventional bonds continued to be issued at a higher pace than sukuk, with USD 33.8 billion conventional bonds being issued versus USD 17.8 billion sukuk issuances.
