▪ MYR ended slightly higher against the USD last week and relatively stable despite S&P's negative outlook on Malaysia. This was supported by positive news of lower COVID-19 cases recorded in the country, and optimism in the oil market as countries around the world eased restrictions, fuelling demand for oil.
▪ MYR could be pressured this week on the back of risk-off mode as global COVID-19 cases continue to rise, while the market is expecting Bank Negara Malaysia (BNM) to slash its OPR on 7 July. Likewise, the house expects BNM to cut OPR by 25 bps to reinforce fiscal measures to further support the economic recovery.
▪ 5-day EMA indicates that MYR may continue its upward momentum this week and strengthen slightly against the dollar by 0.04% to 4.286.
▪ The pair had established a tight trading range between 4.284 and 4.287 last week. Therefore, the short-term bias in USDMYR has turned neutral for this week. However, the current risk-off sentiment across the market may prompt the greenback to settle above the (R2) 4.290 level.
Source: Kenanga Research - 6 Jul 2020
Created by kiasutrader | Aug 26, 2024