EUR/MYR Outlook:
The EUR/MYR rate is currently below its 90-day average and near its recent lows, creating a bearish outlook for the euro. This position is supported by weakening consumer confidence and economic data coming from the Eurozone.
Key drivers:
• Rate gap: The European Central Bank is maintaining its accommodative stance, while Bank Negara Malaysia's stable interest rate helps the MYR gain strength.
• Risk/commodities: Oil prices are at 90-day highs, which favor the MYR as Malaysia is a net exporter of crude.
• Economic growth: Malaysia's construction sector saw a robust expansion, boosting overall economic performance and the MYR's value.
Range:
The EUR/MYR is likely to drift within its recent range, facing challenges to break higher substantially.
What could change it:
• Upside risk: A significant improvement in Eurozone economic indicators could boost the euro.
• Downside risk: Further declines in consumer confidence in the Eurozone could pressure the euro even lower.