KUALA LUMPUR, Jan 29 — Rating agency Moody’s has downgraded Malaysia’s macro profile to “Strong–” from “Strong” to reflect what it described as a deteriorating operating environment for banks in the country.

Moody’s said in a statement today that “heightened external vulnerabilities” and “volatile capital outflows” affected Malaysia’s macro profile rating.

Moody also re-assessed the standalone baseline credit assessments (BCA), but said that Malaysia’s 12 rated banks were not affected by the profile change.

“The weakening ringgit, coupled with political tensions and higher prices, has dampened consumer sentiment,” Moody said.

It said that for the first three quarters of 2015, Malaysia’s current account surplus had almost halved and that domestic political risks had also increased.

“Credit growth has been moderating in recent quarters, reflecting in part macroprudential measures as well as worsening sentiments,” it said, while pointing out Malaysia’s high household debt.

Moody’s downgraded earlier this month Malaysia’s credit rating outlook due to weaker finances.

Malaysia’s economy has staggered over the past year due to the plummeting of crude oil prices, which subsequently caused the weakening of the currency.

Putrajaya yesterday revised its federal budget for the second year running due to changing oil price estimations.

The latest revision caused the ringgit to finally strengthen for the first time since last October when trading commenced today.