Malaysia on saturday said interest rates and fuel prices will remain at current levels as the country targets robust growth of 6.5 percent next year.

Nor Mohamed Yakcop, second finance minister, told reporters that Malaysia needed a buoyant domestic economy to stave off global uncertainties arising from the Us subprime mortgage sector.

"Our earlier prediction was 6.5 percent growth for 2008. Due to the global uncertainties, we now forecast growth between six percent to

6.5 percent," he said.

"We think we will grow at six percent if not 6.5 percent."

The government cut corporate tax rates and property stamp duty in the 2008 budget unveiled Friday. Nor Mohamad said that the key interest rate at 3.50 percent was "suitable for growth."

"The rate will continue to be accommodative. It will not restrain growth," he said, when asked if the government will continue to maintain interest rates at current levels to bloster domestic driven growth.

Nor Mohamad also said that the government's fuel subsidy

programme will cost the government some 25 billion ringgit (seven billion dollars) next year.

Asked if the government had plans to raise fuel prices, he said: "At this point of time, there is no intention to increase fuel prices next year."

"The subsidy is an important issue. We provide it because we want to take care of the poor," he added.

Malaysia imposed its highest-ever fuel price rises in February last year, citing rising oil prices, and pledged to use the cost savings to boost the country's mediocre transport system.