MYR/USD Outlook:
Slightly positive, but likely to move sideways as the MYR is above its recent average but lacks a clear driver.
Key drivers:
• Rate gap: The Malaysian central bank's stable policies have supported the MYR against a relatively weaker USD due to the Federal Reserve's ongoing rate stability.
• Risk/commodities: Current oil prices are above average, which generally supports the MYR given Malaysia's oil-exporting position.
• One macro factor: Malaysia's GDP growth remains robust at approximately 5.2%, driven by domestic consumption and exports.
Range:
The MYR/USD is expected to drift within its recent range as it remains above average but without strong momentum either way.
What could change it:
• Upside risk: Stronger-than-expected US labor market data could bolster the USD, leading to a potential rise in the MYR/USD.
• Downside risk: A significant deterioration in global geopolitical dynamics could pressure the MYR as investor confidence shifts.