Highlights of the report as follow:-
Japan: BoJ meeting on 21 September 2016
v Bank of Japan (BoJ) coming monetary policy meeting has a wide range of expectations. Governor Kuroda is in favour for a deeper cut into the negative interest rate which is currently at -0.10%.
If BoJ meets market expectations with a deeper negative rates, the JPY against US dollar is expected to depreciate to 104 (-2.11%) and weaken against MYR to 3.98.
US: FOMC meeting on 21 September 2016
v About 96% of market observers say rates will be remain unchanged.
If Fed maintains its policy rate as expected, the U.S. Treasury yield curve could flatten. We expect the USD/MYR to fluctuate in the range of 4.08-4.11, supported by bond-related inflows.