GBP/MYR Outlook: The outlook for GBP/MYR is slightly weaker and likely to move sideways, as it is currently below its recent average and near mid-range within the past three months.
Key drivers:
• Rate gap: The Bank of England is expected to reduce interest rates while Bank Negara Malaysia maintains a stable policy, putting pressure on the GBP against the MYR.
• Risk/commodities: Oil prices are above their recent average, which may support the MYR given Malaysia's strong commodity exports.
• One macro factor: Ongoing concerns over US tariffs could hurt UK growth, influencing the GBP negatively.
Range: The pair is likely to drift within its recent 3-month range, given the current lack of strong directional drivers.
What could change it:
• Upside risk: A surprising improvement in the UK job market could boost GBP demand.
• Downside risk: Further escalation in US-China trade tensions could weigh heavily on the GBP.