The Malaysian Ringgit (MYR) to Indian Rupee (INR) exchange rate has reached a 90-day high, currently trading near 20.87. This represents a 2.2% increase above the three-month average of 20.42, with fluctuations primarily contained within a 4.0% range from 20.06 to 20.87. Analysts suggest that the MYR's recent strength is supported by significant foreign reserves, amounting to RM520.7 billion, which provide a buffer against external shocks.
Recent developments influencing the MYR include the Bank Negara Malaysia's decision to cut the overnight policy rate by 25 basis points to 2.75%, the first cut in five years, aimed at stimulating the economy amidst global trade tensions. Efforts to negotiate favorable trade terms with the U.S. may also play a role in stabilizing the MYR, while ongoing structural reforms are expected to bolster economic resilience. Experts note that these factors could underpin the MYR’s performance in the near term.
Conversely, the Indian Rupee (INR) has seen fluctuations, with a recent decline of 0.24% against the U.S. dollar, closing at 87.2700. This depreciation has been largely attributed to oil-importing companies intensifying their dollar purchases. The approaching U.S. tariffs on Indian goods could further exert pressure on the INR, although proposed tax cuts by the Indian government may stimulate consumption and provide some support.
Furthermore, geopolitical improvements, particularly concerning oil trade with Russia, have eased some pressures on the INR. However, traders remain cautious as foreign banks have been selling dollars consistently, leading to some confusion in market dynamics.
Oil price trends also play a significant role in both currencies' performance. Currently, oil prices stand at $68.12 per barrel, slightly below the three-month average of $68.85, and exhibiting notable volatility with a 25.6% trading range. Given that both Malaysia and India are significant oil importers, any shifts in oil prices could directly impact the MYR and INR exchange rate dynamics.
In summary, the MYR appears to be enjoying a period of strength supported by monetary policy adjustments and favorable trade negotiations, while the INR is navigating challenges stemming from external pressures and tariff uncertainties. Ongoing developments in both domestic policies and international relations will be crucial in shaping the outlook for the MYR/INR exchange rate in the coming months.
