The Malaysian Ringgit (MYR) is currently facing significant challenges amid escalating trade tensions, particularly following the announcement of a 24% tariff by U.S. President Donald Trump on imports from Malaysia. This move adds to increasing pressures on emerging Asian currencies, with heightened concerns over a potential global trade war affecting market sentiment.
Recent data shows the MYR to USD is trading near 14-day lows at 0.2353, which positions it just 0.8% above its 3-month average of 0.2336. The MYR has displayed stability, trading within a 5.4% range from 0.2261 to 0.2382. In comparison, the MYR to EUR has dipped to 0.2012, marking a 1.5% decline below its 3-month average of 0.2043 and oscillating in a range from 0.1988 to 0.2102. Meanwhile, the MYR to GBP at 0.1734 is slightly below its 3-month average, maintaining a stable range between 0.1705 and 0.1788.
The MYR has exhibited a stronger performance against the Japanese yen, trading at 34.44, which is 2.1% above its 3-month average of 33.73 and displaying a wider trading range of 32.17 to 34.56. Analysts have noted that the overall sentiment towards emerging markets is growing cautious, particularly as multiple central banks in the region cut interest rates to stimulate growth.
The oil markets also play a crucial role for the MYR, given Malaysia's status as an oil producer. Currently, oil is trading at 68.64 USD, which is 2.5% above its 3-month average of 66.99. This price stability, albeit within a volatile range of 60.14 to 78.85, can potentially support the MYR’s valuation if sustained.
Given the ongoing geopolitical and economic developments, market watchers will likely keep a close eye on how regional currencies, including the MYR, react in the coming weeks, especially as Malaysia leads efforts to coordinate a regional response to U.S. tariffs.
