The market bias for the MYR to TWD is currently bullish.
Key drivers include the interest rate differential, with the Malaysian central bank potentially benefiting from narrowing U.S. rates. This shift may strengthen the MYR, especially against the TWD, as Malaysia's fiscal reforms and economic resilience gain traction. Improved fiscal standing also supports the MYR's positive outlook, as Malaysia is experiencing increased foreign investment and decreasing fiscal deficits.
In contrast, the TWD is influenced by Taiwan's central bank commitment to maintaining exchange rate stability and new financial regulations, which foster market transparency but may contribute to volatility.
The near-term trading range is expected to remain stable, with the MYR trading significantly above its recent three-month average.
An upside risk could involve sustained investment inflows into Malaysia, while a downside risk might arise from geopolitical tensions affecting regional trade dynamics.