MYR/THB Outlook: Slightly positive, but likely to move sideways, as the rate is above its recent average and near its 3-month high without strong drivers.
Key drivers:
• Rate gap: The Bank of Malaysia is maintaining a stronger monetary stance compared to the Bank of Thailand’s recent interest rate cut.
• Risk/commodities: The recent rise in oil prices supports the MYR, benefiting from its strong export sector reliant on commodities like palm oil and oil.
• One macro factor: Malaysia's robust GDP growth projection of 5.1% strengthens investor confidence in the MYR.
Range: Expect the MYR/THB to hold within its recent range, as market dynamics appear stable.
What could change it:
• Upside risk: Further significant increases in global oil prices could bolster MYR.
• Downside risk: A surprise slowing in Malaysia’s economic growth could weaken the MYR against the THB.