MYR/VND Outlook: Slightly positive, but likely to move sideways as the rate is above its recent average and within its 3-month range.
Key drivers:
• Rate gap: The Malaysian central bank's decision to maintain a low interest rate supports the MYR, while the State Bank of Vietnam keeps a higher rate to stabilize the VND.
• Risk/commodities: Current high oil prices are positively affecting Malaysia's economy by boosting exports, which tends to strengthen the MYR against the VND.
• One macro factor: Vietnam's upcoming legislative elections may spur some uncertainty, affecting investment and the VND value.
Range: The MYR/VND is likely to hold within its recent range, with potential minor fluctuations.
What could change it:
• Upside risk: Stronger-than-expected economic data from Malaysia could enhance the MYR's strength.
• Downside risk: Any significant shifts in Vietnam's economic policy following the elections could pressure the VND.