BNM Keeps Rates Steady, MYR Tracked by Global Rates and Risk Sentiment

Bank Negara Malaysia (BNM) kept the Overnight Policy Rate (OPR) at 2.75% as expected, but the accompanying statement had a slightly firmer tone. The central bank now expects growth to remain resilient into 2027, citing sound fundamentals and remaining vigilant to cost pressures and domestic demand conditions amid elevated global commodity prices.

According to OCBC's economist Christopher Wong, this relatively firm domestic backdrop should support the Malaysian Ringgit (MYR). However, near-term USD/MYR moves will track the broader US Dollar, risk sentiment, and global rates. Wong still projects an OPR normalisation to 3.00% in January 2027.

The daily chart of USD/MYR shows bearish momentum has faded while the Relative Strength Index (RSI) has moderated. As a result, two-way risks are likely, with support at 4.0320 levels and resistance at 4.05 and 4.0610 levels.