KUALA LUMPUR, Sept. 19 (Xinhua) -- S&P Global Ratings on Friday affirmed its "A-" long-term and "A-2" short-term foreign currency sovereign credit ratings on Malaysia.
The rating agency said in a statement that it also affirmed its "A" long-term and "A-1" short-term local currency ratings for the country.
The outlook on the long-term ratings is stable, and the transfer and convertibility assessment remains "A+," it said.
"The stable outlook reflects our expectation that Malaysia's growth momentum and prevailing policy environment will allow modest improvements in fiscal performance over the next two to three years," said S&P.
It noted Malaysia's consistently strong economic growth and high degree of monetary policy flexibility underpin its ratings.
In addition, its external position is balanced, characterized by moderate current account surpluses and a large export base.
S&P, however, forecast Malaysia's 2025 growth to moderate to 4.2 percent, following a solid 5.1 percent outturn in 2024, as external trade headwinds dampen near-term momentum.
"Malaysia's highly trade-oriented economy is vulnerable to a slowdown in regional and global trade flows, as well as to a potential reduction of exports, following the imposition of a 19 percent tariff on some goods exports to the U.S. since Aug. 7, 2025," it said.
While Malaysia has been a beneficiary of the global semiconductor boom in recent years, it added that this industry also faces high cyclical risks dependent upon U.S. sector-specific tariff policies. ■