KUALA LUMPUR (Jan 22): The United States (US) dollar is expected to strengthen over the year, despite warnings around potential market volatilities, according to Manulife Investment Management.
Chief investment officer for Asia (ex-Japan) fixed income Murray Collis said these fluctuations will create opportunities for investors to take advantage.
“When we look at central banks across the region, we do think that they are looking to rate cut this year and we have had several central banks show that intention.
“The resistance to that is the strength of the US dollar, any volatility that could come into their domestic economies is from the strength of the dollar,” he said during the Manulife Investment Management 2025 Asia Investment Outlook media briefing here on Wednesday.
Meanwhile, senior portfolio manager and head of asset allocation for Asia Luke Browne noted that the US’s pro-growth approach from the new administration has a positive development but it will be costly towards certain parties.
“I do think we are going to see something of sort of bifurcated market in terms of the impact of sanctions/tariffs.
“They (US) have gone for their most immediate neighbours first, and I think it is going to cascade out across the world, with the bigger trading blocs Europe and China going next,” he said.
On the local front, senior portfolio manager for equities Kenglin Tan said the Malaysian market performed well in 2024 predominantly driven by the technology-related sector, which saw a lot of investment in data centres.
However, she foresees the country could face some headwinds in 2025, especially in terms of data centre investment.
“Coming into 2025, we are seeing some headwinds in the market, especially in the investment in data centres following the US policy on chip control.
“Thus, we expect the self-help plan by the government to step in to drive domestic consumption, as well as the small and medium enterprise (SME) sector,” said Tan.
For the Asean region, she said that the governments are putting forth domestic policies to support domestic economic growth and foreign direct investment growth.
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