The exchange rate forecast for the Hong Kong Dollar (HKD) against the Malaysian Ringgit (MYR) reflects a mixed outlook, influenced by recent economic developments in both territories. The HKD has been under pressure due to a series of interest rate cuts implemented by the Hong Kong Monetary Authority (HKMA), which reduced the base rate to 4.25% as of October 30, 2025. These cuts were aimed at aligning with U.S. Federal Reserve actions, indicative of a broader easing within the financial landscape. The HKMA has also taken significant steps by intervening in the currency market to support the HKD amid its struggle within its trading band, with recent purchases amounting to billions of HKD.
As a consequence of these monetary easing measures, the HKD has consequently softened, trading at near 90-day lows of 0.5315 against the MYR, which is 1.7% lower than its three-month average of 0.5406. Analysts suggest that the combination of low interbank offered rates and monetary interventions has contributed to this downward pressure on the HKD, making it less attractive to investors and thus weakening its position relative to the MYR.
Conversely, the Malaysian Ringgit is experiencing positive momentum, reaching a 13-month high driven by a positive economic outlook and stable interest rates set by Bank Negara Malaysia at 3%. The MYR has been bolstered by the recent ASEAN Summit, which secured beneficial trade agreements with the U.S., enhancing export prospects. Significant GDP growth recorded at 5.2% in the third quarter of 2025 further supports the Ringgit's strength.
Additionally, the MYR’s performance is somewhat correlated with oil prices, which have been volatile, trading at $64.29 per barrel, representing a 2.1% decline from its three-month average of $65.67. This ongoing fluctuation in oil prices, within a considerable range of 15%, could influence market sentiment surrounding the MYR, especially as Malaysia is a significant oil exporter.
In conclusion, while the HKD faces challenges from domestic monetary policies and interventions aimed at stabilizing its value, the MYR capitalizes on economic resilience and favorable external factors. Analysts suggest businesses and individuals involved in transactions between these currencies should remain vigilant of the developing economic indicators and currency interventions that may shape future trends.
