Commerzbank strategists note that USD/MYR has remained in a 3.90–4.05 range since the Middle East conflict began. Malaysia’s March industrial production grew 3.1% year-on-year, supported by strong manufacturing and electronics despite weaker mining. They highlight that MYR is the best-performing Asian currency this year, helped by Malaysia’s net energy exporter status.

Stable range with MYR leadership

"March industrial production rose less than expected by 3.1% yoy (Bloomberg consensus: 3.5%), matching February’s reading. This was the softest reading since May 2025 and was largely due to weaker mining output. The manufacturing and electricity sectors remained resilient, aided by the electronics sector. The mining sector may continue to face headwinds in the coming months due to supply chain disruptions and lower productivity in maturing oil fields."

"Manufacturing output growth quickened to 5.5% yoy vs 4.2% in February. It was supported by export-oriented manufacturing which rose 6.7% vs 5.0% in February. This was driven by firm AI-related demand for semiconductors and higher global crude palm oil prices which rose more than 19% in March."

"Electronic production rose 20.5% vs 22.5% previously, while plant and animal oil manufacturing output rose 13.5% vs 0.3% in February. Domestic-oriented manufacturing rose 2.8% vs 2.7% in February."

"Mining output fell 6.5% yoy vs 2.0% previously. This could be attributed to planned maintenance activities at several oil and gas facilities. Nonetheless, the mining sector was supported by higher prices with March's producer price index for the mining sector surging 26.5% yoy. Electricity output rose 4.9% vs 4.6% in February."

"Since the start of conflict in the Middle East, the pair has been less volatile than its peers due to Malaysia’s status as a net energy exporter. Over that time period, USD/MYR held between the 3.90-4.05 range. MYR is the strongest performing Asian currency this year, up 3.5% vs the USD compared to the average for Asian currencies ex-Japan of -1.2%."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)