KL's 2016 fiscal deficit target 'a stretch'
As growth slows amid ringgit's significant depreciation, the 3.1% forecast could widen to 3.5%, say analysts
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Kuala Lumpur
MALAYSIA is expected to achieve its fiscal deficit forecast of 3.2 per cent of gross domestic product (GDP) for this year, but analysts consider its modest 3.1 per cent target for 2016 as still a stretch because growth is slowing amid challenging conditions including the significant depreciation of the ringgit.
As the year winds to an end, there is less confidence the unassuming target can be met as global oil prices continue to slump below US$40 per barrel versus the government's 2016 budget based on oil price assumption of US$48 per barrel, and as China's growth falters. Consumer purchasing power is also contracting noticeably.
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