Ringgit Rallies on Weaker-than-Expected US Jobs Data

The Malaysian ringgit has seen an unexpected boost against the US dollar after weaker-than-expected non-farm payrolls data was released in the United States.

The data, released on Monday, showed a decline of 23,000 jobs in July, far below the estimated increase of 88,000. The Labour Force Participation Rate also continued to decline for eight consecutive months, reaching 61.4 percent, while Average Hourly Earnings grew at a moderate pace of 3.2 percent.

This has led Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam to believe that the odds of an interest rate hike at the September Federal Open Market Committee meeting have decreased to 43.9 percent, down from 57 percent previously.

Despite this boost for the ringgit, Dr Afzanizam cautioned that the Strait of Hormuz situation remains a major wildcard, keeping market sentiment in check and causing volatility.