Macroeconomic Forecast Malaysia

In view of improving global trade and the beginning of Bank Negara Malaysia's (BNM's) interest rate hike cycle, we expect the central bank to allow the Malaysian ringgit to gradually appreciate towards the end of the year. Moreover, our view is in line with expectations of an upward revaluation of the Chinese yuan peg by Beijing in H210 (3.8% appreciation pencilled in), which would allow BNM to revalue the ringgit and still remain competitive. As such, we foresee the Malaysian ringgit rising towards MYR3.1000/US$ by the end of 2010.

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