The exchange rate forecast for the Hong Kong Dollar (HKD) against the Malaysian ringgit (MYR) indicates ongoing challenges for the HKD amid recent developments and market pressures. As of December 4, 2025, the HKD is trading at 90-day lows near 0.5239, which is 2.3% below its three-month average of 0.5363. The range has stabilized, oscillating between 0.5239 to 0.5443. Analysts observe that the HKD's weakness can be partially attributed to the Hong Kong Monetary Authority's (HKMA) decision to reduce the base interest rate by 25 basis points in late October, mirroring the U.S. Federal Reserve's actions. This interest rate cut is aimed at stimulating the economy but simultaneously heightens the interest rate differential with global currencies, which may weigh further on the HKD's value.
Currency interventions by the HKMA earlier in the year created increased liquidity but have not been sufficient to sustain the HKD against the pressures of capital inflows and shifts in global interest rates. Forecasters note that the HKMA's persistent efforts to defend the currency peg within the 7.75-7.85 range against the U.S. dollar showcase the challenges the HKD faces from market dynamics.
Conversely, the MYR has been on an upward trajectory, reaching a 13-month high against the U.S. dollar, supported by robust economic growth and expectations of a rate cut from the U.S Federal Reserve. Positive indicators such as a strong trade balance driven by exports, particularly in electronics and commodities, along with sustained foreign direct investment, bolster investor confidence in the MYR.
The outlook for the MYR is further enhanced by the Malaysian government's fiscal consolidation efforts, which signal greater economic stability and encourage investment inflows. The recent trade agreements established during the ASEAN Summit also contribute positively, granting tariff exemptions on numerous products, which support the MYR's strength.
Additionally, fluctuations in oil prices could impact MYR performance given Malaysia's association with oil exports. Currently, oil prices are approximately 5.2% below their three-month average, hovering around 60.53, within a notable volatile range from 59.04 to 70.13. Economists suggest close monitoring of oil market trends, as significant movements could sway the MYR.
In summary, the picture for HKD against MYR remains challenging, with the HKD under pressure due to domestic economic measures and external influences, whereas the MYR is exhibiting strength bolstered by a favorable economic outlook and confident market sentiment.
