Malaysia first to be marked down by S&P due to lower oil prices

SINGAPORE - Standard & Poor's has lowered its GDP growth forecast for Malaysia to 4.6% in 2015 and to 5.0% for 2016 from 5.5% and 5.4%, respectively, predicted earlier because of a further steep decline in oil prices.

"The steep drop in global oil prices, which we now expect to last at least through 2016, will likely hurt Malaysia's exports, reduce investment, and lower wealth and spending power," said S&P chief economist, Paul Gruenwald.

“Due to Malaysia's slower GDP growth trajectory and reduced pressure on inflation, we have also revised our policy rate forecast for Bank Negara. We now see the Malaysian central bank keeping the benchmark rate on hold at 3.25% into 2016,” Gruenwald added.

“At this juncture, we have only revised our forecast for Malaysia, given its unique position as the sole major Asia-Pacific economy that is a net oil and gas exporter. We expect to release a full set of Asia-Pacific forecasts in late March 2015.” www.standardandpoors.com (ATI).