Labour data and Hormuz risks to test whether USD rally has peaked
Performance: MYR strengthened to 4.12/USD from Monday's high of 4.15 as risk sentiment stabilised and USD demand eased.
Market Dynamics: Hawkish Fed rhetoric and expectations of higher US rates initially weakened the MYR. The ringgit later recovered as equity volatility eased and Strait of Hormuz disruption fears receded. Brent falling below USD75.0/barrel and steady crude shipments signalled easing geopolitical risk premiums, although elevated US yields continued to underpin the USD. FX positioning remained moderately USD-supportive ahead of key US labour market data.
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