NZD/MYR Outlook:
Slightly positive, but likely to move sideways, as the rate is near its recent average with mixed drivers.
Key drivers:
• Rate gap: The Reserve Bank of New Zealand is signaling potential interest rate cuts, while Malaysia's central bank benefits from a weaker US Dollar.
• Risk/commodities: High dairy prices are supporting New Zealand's export income, while the Malaysian Ringgit is benefiting from reduced US Federal Reserve interest rates.
• One macro factor: Malaysia's GDP growth of 5.2% showcases economic resilience, which supports the MYR's performance against the NZD.
Range:
The NZD/MYR is likely to drift within its established range, reflecting current stability.
What could change it:
• Upside risk: A surge in global dairy prices could drive the NZD higher.
• Downside risk: Increased US-China trade tensions may negatively impact the NZD as global market conditions worsen.