The EUR to MYR market is currently range-bound.
Key drivers include:
- The interest rate differential is expected to tighten due to the ECB's cautious approach and potential interest rate cuts from the Federal Reserve, which may benefit the MYR.
- Positive economic indicators from Malaysia indicate strong GDP growth and fiscal reforms, supporting the MYR’s performance.
- Ongoing geopolitical tensions and uncertainties can impact the euro, particularly with the war in Ukraine affecting energy supply and inflation.
Over the next few months, EUR to MYR is likely to trade within a stable range, given recent movements showing the euro at a slight discount compared to its average.
Upside risks include a significant improvement in eurozone economic data that might lift the euro. Downside risks could stem from worsening geopolitical tensions or a sudden drop in oil prices that may pressure the EUR performance.