Malaysi an household debt is soaring, placing the country's economic growth at risk - say The Financial Times. It named Malaysia and Thailand as being most at risk, saying their household debt-to-GDP ratios had almost doubled between 2008 and 2014 to nearly 90%. Factors that influenced Malaysia's increase in debt included favourable credit conditions and strong consumer demand.
In January, credit rating agency Moody's said household debt had risen by more than 15% of GDP since 2009 to around 87% as of end-2014, levels similar to more advanced, higher-income economies.
The agency said rising debt was a factor in its decision to cut Malaysia's sovereign ratings outlook. On January 11, Moody's cut Malaysia's sovereign rating outlook to stable from positive due to the negative impact of changes in the external environment on the Southeast Asian economy's growth.
The ratings agency said the change in outlook reflected a deterioration in Malaysia's growth and external credit metrics due to external pressures over the past year. It affirmed Malaysia's issuer and senior unsecured bond ratings at A3
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