The recent outlook of the CAD to MYR exchange rate reflects a complex interplay of global economic factors and domestic developments in both Canada and Malaysia. As of recent data, the CAD has seen downward pressure, trading near 90-day lows at 3.0278, which is approximately 1.4% lower than its three-month average of 3.072. The Canadian dollar's performance is closely linked to oil prices, as Canada is a significant oil exporter. Current oil prices are at 30-day highs around $69.31, exceeding the three-month average and indicating a potential upward influence on the CAD if this trend persists.
Analysts note a bearish sentiment surrounding the CAD, with non-commercial net short positions recently rising to a five-month high. Weaker-than-expected employment data has raised the probability of interest rate cuts by the Bank of Canada (BoC), further complicating the CAD's outlook. Despite these bearish trends, a recent poll indicated optimism among analysts, predicting a possible CAD strengthening to 1.36 per U.S. dollar within three months, based on expectations that the BoC may soon conclude its cycle of rate cuts.
Conversely, the Malaysian Ringgit has shown a mixed trajectory. Following its first rate cut in five years by Bank Negara Malaysia in July, the overnight policy rate was kept steady at 2.75% in early September, with the central bank citing stable inflation and resilient economic growth. Despite facing headwinds from U.S. tariffs, analysts project the MYR may strengthen, with forecasts suggesting it could hit the range of RM4.10 to RM4.15 against the U.S. dollar by December.
The interplay between these currencies suggests that while the CAD could benefit from rising oil prices, ongoing challenges, including potential rate cuts and bearish positions, could limit its upside. Similarly, while the MYR has shown resilience, external economic pressures may influence its trajectory. Observers in the market will need to monitor developments from both countries, particularly in terms of economic indicators and central bank decisions, which are likely to shape future movements in the CAD/MYR exchange rate.
