Oil market's bounce masks persistent risk in Malaysian debt

Jakarta

APRIL was a good month for Malaysia's economy, one of the most deeply exposed to foreign debt in Asia, as a bounce in oil prices boosted foreign reserves and its currency rose the most in three years. But behind the good news lurks lingering danger.

The energy exporter faces an imminent downgrade of its debt by ratings agency Fitch, just one reminder of the risks from oil and commodity prices that are still low by historical standards and from cracks in the political stability that once supported its solid growth.