PETALING JAYA: The possible increase in Malaysia’s debt ceiling limit will unlikely lead to a downgrade in its sovereign credit rating, says MIDF Research.
According to the brokerage, history showed Malaysia had increased its debt-ceiling limit a few times in the past, but not once had its sovereign credit rating downgraded because of the revisions. It pointed out although there was a possibility of an increase of the debt-ceiling limit in the event of a recession, debt-to-gross domestic product (GDP) level should not be seen as an important indicator of fiscal sustainability.