The exchange rate forecasts for the Malaysian Ringgit (MYR) against the New Taiwan Dollar (TWD) reflect a favorable outlook for the MYR in light of recent developments. Analysts note that the MYR has appreciated to the highest levels seen in 13 months, largely due to a combination of positive factors including expectations of a US Federal Reserve rate cut and Malaysia's robust economic growth prospects. A strong trade balance supported by high exports in electronics and commodities, as well as substantial foreign direct investment inflows, have all contributed to this trend.
Moreover, the Malaysian government’s fiscal consolidation initiatives have bolstered investor confidence in the MYR. Following the recent ASEAN Summit, which resulted in beneficial trade agreements, analysts believe that the MYR's strength will continue to support its position against the TWD. Currently, the MYR to TWD exchange rate is at 90-day highs near 7.7309, significantly above its three-month average of 7.4129, indicating substantial appreciation.
In contrast, developments affecting the TWD, while largely positive, present some challenges. Taiwan's economy is projected to grow at a robust 7.37% in 2025, attributed to the rising global demand for AI technologies. However, ongoing trade negotiations with the U.S. aimed at reducing tariffs signify tensions that could affect export competitiveness. Furthermore, Taiwan’s announced increase in defense spending to counteract external pressures may unsettle some investors.
The recent price trends for oil, trading at $60.53, 5.2% below its three-month average, suggest heightened volatility that could impact both currencies given that Malaysia is a significant oil exporter. This price fluctuations could create additional layers of volatility for the MYR, particularly if oil prices move substantially in either direction.
Overall, while the MYR exhibits strength against the TWD, ongoing developments in both economies—especially related to trade negotiations and defense spending—will play critical roles in shaping future exchange rate dynamics. Forecasters advise monitoring these factors closely, as the currency markets are inherently sensitive to shifts in economic policy and global market conditions.
