Recent forecasts indicate a challenging environment for both the Canadian dollar (CAD) and the Malaysian ringgit (MYR), with developments in international trade policies and commodity prices playing pivotal roles in shaping their exchange rate.
The CAD has faced downward pressure as it remains tied to fluctuating oil prices. Analysts note that the CAD weakened recently due to declining oil prices, which directly impacts Canada's economy, a significant oil exporter. Current data shows that oil is trading at 14-day lows near $68.59, despite being 1.8% above its three-month average. Analysts suggest that if oil prices continue to decline, the "loonie" could remain defensive against other currencies, including the MYR.
In tandem, the MYR has also been affected by geopolitical tensions and trade policies, most notably the announcement of a 24% tariff on imports from Malaysia by the U.S. This tariff has contributed to a deteriorating outlook for emerging Asian currencies, triggering a regional sell-off. Economists forecast that the MYR may struggle to recover in the face of these trade tensions and a global risk-averse sentiment among investors.
Recent exchange rate data reveals that the CAD to MYR pairing is trading at 14-day highs near 3.1131, reflecting a stable range of 4.0% over the past three months. Experts point out that while the CAD has shown relative stability, its future trajectory will be influenced by the ongoing uncertainties related to U.S. trade policies and oil market volatility.
With Canada’s economic prospects closely tied to commodity prices and U.S. trade relations, future movements of the CAD will hinge upon oil trends and the broader global economic recovery. Conversely, the MYR could see further weakening unless regional economic conditions improve and trade tensions ease.
In conclusion, analyses suggest that individuals and businesses engaging in international transactions should remain alert to developments in both the commodity markets and international trade policies to anticipate potential movements in the CAD/MYR exchange rate.