Deutsche Bank Markets Research predicts MYR to continue dropping as boxed in by debt.

USD/MYR could trade to its 2008 crisis highs of 3.73 & potentially back to its 2005 peg levels this year. MYR weakest in region.

  • Malaysia’s external debt metrics are worrying.
    Only enough to cover short-term liabilities (< 1 yr)
  • The fiscal deficit likely to miss govt target of 3%.
    Mainly due to lower petroleum revenue.
  • Household debt as a % GDP at 87% is the largest in the region.
    Lower private consumer spending due to GST, etc
  • The current account is at risk of dipping into a deficit.
    Imports outpacing exports.

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Read full report: MYR Boxed in by debt, FX to break

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