Traders continue to hold confidence in Malaysian government bonds after finance officials warned that the country may miss its fiscal deficit targets. Free Malaysia Today reports that Finance Minister II Amir Hamzah Azizan says Malaysia might not meet its 2026 deficit target, linking the risk to higher fuel-subsidy costs driven by the ongoing conflict in Iran, which is pushing up fuel expenses. Bloomberg similarly describes market participants as remaining “sanguine” about Malaysia’s financial outlook despite the warning that the government could fail to hit its deficit goal for the year. Bloomberg attributes this resilience to signals from a closely watched financial-market metric, suggesting investors do not view the deficit risk as a near-term trigger for a sharp deterioration in sovereign credit conditions. Taken together, the reports indicate that while fiscal targets are under pressure—particularly from subsidy-related spending—bond traders continue to price Malaysia’s risk in a relatively stable way. The sources do not provide new figures for the deficit shortfall or changes to bond yields within the summaries.