Bias: The MYR/TWD pair is currently bullish-to-range-bound, sitting above the 90-day average and in the upper half of the 3-month range.
Key drivers:
• Rate gap: The Malaysian central bank's interest rate cuts could bolster the MYR against the TWD amid lower global rates.
• Risk/commodities: Recent rises in oil prices may support the MYR, as higher oil values can enhance Malaysia's export revenues.
• One macro factor: Malaysia's projected GDP growth of 5.1% in 2025 supports investor confidence and should lend strength to the MYR.
Range: The MYR/TWD is likely to drift within its recent range as the pair approaches its 90-day highs.
What could change it:
• Upside risk: A further increase in oil prices could boost the MYR.
• Downside risk: Unexpected changes in Taiwan's monetary policy could impact the TWD's strength.