Malaysia risks downgrade if debt burden increases, says Moody’s
https://www.freemalaysiatoday.com/c...owngrade-if-debt-burden-increases-says-moodys
International rating agency Moody’s says Malaysia’s current A3 stable rating could be threatened if the government’s debt obligation increases.
“We would consider downgrading the rating if Malaysia’s fiscal prospects weaken, or its debt burden increases,” it said in its annual analysis of the country’s credit rating. The rating agency sounded a caution on pervasive corruption which it said was likely to remain a challenge for the government. Downward rating pressures could also arise if growing political tensions and diverging views within the government undermine the effectiveness of policies or impair the government’s ability to adhere to its fiscal consolidation objectives, and/or threaten the stability of capital flows to Malaysia.
Nomura downgrades Malaysian shares, warns of possible slip in sovereign ratings
https://www.cnbc.com/2019/01/09/inv...alaysia-shares-on-credit-ratings-outlook.html
Japanese bank Nomura has downgraded Malaysian shares, saying the new government's lack of "significant reform push" could lead to a worsening fiscal position and a possible slip in credit ratings.
Nomura moved its stance on Malaysian stocks from "neutral" to "underweight," it said in a Wednesday report. The call followed a similar downgrade by Singapore bank DBS, which in a Monday report also raised concerns about potential deterioration in the country's finances.
In addition, the fall in oil prices in recent months and "populist moves" such as the removal of goods and services tax are also bad for Malaysia's revenue, Nomura noted. "Our economists believe there is a high risk of fiscal slippage and the possibility of a sovereign ratings downgrade that could trigger more capital outflows," the bank said.