USD/MYR May Eye Test of 200-DMA If BNM Sounds Dovish: Analysis
Source: BFW (Bloomberg First Word)
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(Bloomberg) -- USD/MYR may rally short-term to test 200-DMA if Bank Negara Malaysia adopts a dovish stance at its meeting given weaker-than-expected 2Q GDP and July CPI, Bloomberg strategist David Finnerty writes.
Alert: HALISTER1- Malaysian central bank surprised markets by cutting its interest rate by 25 bps at its July meeting, citing “increasing signs of moderating growth momentum in the major economies”
- Since that meeting, CPI has fallen to 1.1% y/y in July, lowest level since March 2015, while 2Q GDP declined to 4.0% y/y from 4.2% in 1Q, the weakest reading in at least 5 yrs
- USD/MYR’s MACD remains bullishly above zero and signal line
- Bank Negara Malaysia is expected to leave its overnight policy rate at 3.0%, according to 11 of 13 economists in Bloomberg survey with 2 forecasting a 25 bp cut; decision due 3pm local time on Sept. 7
- NOTE: David Finnerty is an FX strategist who writes for Bloomberg. The observations he makes are his own and are not intended as investment advice.
Source: BFW (Bloomberg First Word)
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UUID: 7947283