Ringgit opens slightly higher as Fed hike bets rise

The catalyst was the August US non-farm payrolls report, which showed 162,000 jobs added, well above the 55,000 forecast, while the labor force participation rate rose to 61.6%. That has pushed up the odds of a 25-basis-point hike at the Federal Reserve’s Sept. 15-16 meeting, with markets now focused on Friday’s US consumer price index as the next key test.

For Malaysia, a firmer US rate outlook tends to support the dollar and keep pressure on emerging-market currencies. Bank Muamalat Malaysia chief economist Mohd Afzanizam Abdul Rashid said Asian currencies could see choppy trade and that the ringgit may move in a wider 4.04-4.06 range against the greenback this week.

Still, the ringgit has some buffers. Higher energy prices can help Malaysia as a net energy exporter, and analysts say the country’s role in the regional AI and semiconductor supply chain could offer medium-term support if global capital continues rotating into Asia-linked technology themes.

Against other majors, the ringgit was mostly firmer, rising versus the British pound and euro, but it slipped against the yen. It was also weaker against regional peers, including the Singapore dollar and Thai baht, underscoring that the dollar and US yields remain the main force steering the currency.

The near-term direction will likely hinge on Friday’s CPI print and the Fed’s policy signal next week, with traders watching whether stronger US data keeps the ringgit pinned near the 4.06 level or allows a modest recovery if inflation eases.