Most Asian currencies strengthened on Tuesday, as easing lockdowns in certain parts of the world replaced the increased severity of tensions between China and the United States. The spread of coronaviruses in certain countries/regions is slower, raising people’s awareness of risk. New Zealand has no new cases for the second consecutive day, and Germany, Finland, and New York plan to relax locking restrictions.
Due to the relaxation of social restrictions and falling supply, the prospect of improved demand leading to higher oil prices also helps boost market sentiment.
Meanwhile, investors await the outcome of a policy meeting by Bank Negara Malaysia (BNM) later on Tuesday where it is expected to cut rates by 50 basis points, its biggest cut since the global financial crisis.
The Southeast Asian economy has been hit with a double whammy of a slump in oil prices and disruptions caused by virus-driven curbs. ING expects further monetary easing given the pressure on the Malaysian economy from lower oil prices and pandemic worries.