KUALA LUMPUR, Sept 8, 2025 — The Malaysian ringgit opened the week stronger against the U.S. dollar following a weaker-than-expected U.S. nonfarm payrolls (NFP) report, which intensified market expectations of imminent interest rate cuts by the Federal Reserve. As of 8 AM today, the ringgit traded at RM4.2030/2285 per dollar, up from Thursday’s close of RM4.2260/2320.
Bank Muamalat Malaysia’s chief economist, Dr. Mohd Afzanizam Abdul Rashid, noted that the subdued U.S. jobs data is tilting investor sentiment toward rate easing. He added that while this soft labor report raises pressure on the Fed to pivot, external events—such as Japan’s political transition—could offer temporary support to the dollar.
What’s Behind the Move?
The U.S. reported a meagre increase of 22,000 jobs in August, far below the 75,000 estimate, while the unemployment rate climbed to 4.3%, its highest level since 2021. This data underscores growing concerns of a cooling U.S. labor market.
The immediate market reaction included a weaker dollar, boosting global demand for Emerging Market currencies like the ringgit. The probability of a Fed rate cut in September surged, with futures markets pricing in an 88–97% chance.
What’s in Store for the Ringgit?
Dr. Afzanizam anticipates the ringgit to remain within RM4.20–4.22 per dollar as markets await further U.S. policy signals. Domestic fundamentals—such as monetary stability and resilient economic activity—should provide additional support.
OCBC’s research echoes this optimism, forecasting the ringgit could appreciate further to RM4.15 in Q4 2025 if rate cuts materialize, while Maybank projects a weaker target around RM4.10.
