GBP/MYR Outlook:
The GBP/MYR is currently bearish, trading significantly below its 90-day average and near recent lows. This reflects pressures from UK economic data versus ongoing strength in the Malaysian economy.
Key drivers:
• Rate gap: The Bank of England has held interest rates steady, while Bank Negara Malaysia's stable rates are supporting the MYR.
• Risk/commodities: Oil prices are trending above average, which generally supports the MYR due to Malaysia's status as a crude oil exporter.
• One macro factor: Strong growth in Malaysia's construction sector has boosted economic confidence, enhancing demand for the MYR.
Range:
Expect the GBP/MYR to test lower extremes within its recent 3-month range, as conditions remain favoring further declines.
What could change it:
• Upside risk: A pickup in UK economic performance could shift the outlook for GBP upwards.
• Downside risk: Continued oil price strength may reinforce MYR's trajectory against the GBP.