The USD to MYR exchange rate appears bearish as the US dollar weakens on recent inflation data.
Key drivers include:
- The anticipated interest rate cuts from the Federal Reserve are expected to narrow interest rate differentials, negatively impacting the USD.
- Strong GDP growth and fiscal reforms in Malaysia support the MYR's outlook, marking it as a potential benefactor of global economic trends.
- Rising oil prices, although currently below the three-month average, could further support the MYR, as Malaysia is a significant oil exporter.
In the near term, the USD to MYR is likely to trade within a stable range considering recent price movements and macroeconomic conditions.
Upside risks may arise from unexpected improvements in US consumer sentiment, potentially stabilizing the dollar. Conversely, sustained global de-dollarization trends could further diminish USD value, favoring the MYR.