HALISTER1: Malaysia’s Annual Budget Targets Are ’A Tad Optimistic’: Mizuho

Malaysia’s Annual Budget Targets Are ’A Tad Optimistic’: Mizuho

(Bloomberg) -- Malaysia’s growth and revenue targets unveiled in Friday’s budget are “a tad optimistic” given the lack of clarity of China’s policy impact on commodity prices, says Vishnu Varathan, head of economics and strategy at Mizuho Bank in Singapore.
  • If Malaysia is able to achieve its fiscal consolidation target, it will boost bonds and the ringgit
  • It’s an ‘election budget’ and the transient pump-priming based on higher oil price may come across as hollow, says Varathan. Longer-term fiscal consolidation plans may be needed, he adds
  • One positive is the diversification of government revenue through implementation of the goods and services tax
  • Malaysia Projects 5%-5.5% 2018 GDP Growth, Budget Gap of 2.8%
To contact the reporter on this story: Liau Y-Sing in Kuala Lumpur at yliau@bloomberg.net To contact the editors responsible for this story: Tan Hwee Ann at hatan@bloomberg.net Patricia Lui

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Source: BFW (Bloomberg First Word)

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Vishnu Varathan (Mizuho Bank Ltd)

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