Penang Moves To Phase 2 Of Reopening Plan, PM Sets Parliament Reopening Dates

Spot USD/MYR is barely changed as we type, last sits +8 pips at MYR4.1575, after it emerged that Penang will join the list of states with looser Covid-19 rules. Bulls would be pleased should the rate rally past Jul 2 high of MYR4.1663, towards Jun 24 cycle high of MYR4.1710. Conversely, a dip through Jun 25 low of MYR4.1423 would shift focus to the 50-DMA at MYR4.1298.

• Penang became the sixth state allowed to move to phase 2 of the National Recovery Plan after meeting the three criteria set by the central gov't. Restrictions in the state will be eased from Wednesday, with PM Muhyiddin noting that more states are showing the potential to move to phase 2.
• PM Muhyiddin's office confirmed that the gov't will advise the King to reopen the House of Representatives for a sitting on Jul 26-29 and Aug 2 and to reconvene the Senate for Aug 3-5. The sittings will be held in a hybrid mode.
• Meanwhile, infighting among UMNO leaders over the party's support for PM Muhyiddin's cabinet continues. The party's Supreme Council was supposed to meet today, but one member said he didn't receive a notice, and some have speculated that the meeting might be called off following yesterday's talks between top UMNO leaders.
• BNM will deliver their MonPol decision on Thursday and most analysts see them on hold. Goldman Sachs don't expect any tightening before 2022, while Barclays flagged a risk of a rate cut this week, but said they doubt BNM will take this path.