The Islamic bond market, which had held up relatively well in defiance of the credit crisis, has slumped in the past month because of the sharp fall in the price of oil and deepening gloom over the outlook of the world economy.
Hedge funds, which had pumped money into Islamic products in the Middle East in the first six months of the year because of expectations of revaluations of some of the Gulf currencies against the dollar, have also left the market.
