USDMYR Technical Analysis

The US Dollar dropped against the Ringgit on Thursday and is now trading at 4.3060. The recent downward movement can be explained by the good numbers that Malaysia has been presenting in recent months compared to the numbers of more developed economies, such as the US and countries of the European Union. Exactly because of the low inflation that Malaysia has seen in recent months and unemployment under control is that Bank Negara Malaysia (BNM) decided to keep the interest rate unchanged at 2.75%. As the market was expecting the BNM to raise the interest rate from 2,75% to 3% at this last meeting, the MYR could undergo a significant devaluation over the next few days, as government bonds will pay less interest to investors. From a technical point of view and considering the new scenario of an easier monetary policy, the USDMYR could go up to 4.3600 and 4.4400 in a few days.