The USD/MYR currency pair settled at Friday’s low of 4.2000, its weakest level since August 25th, as concerns over a weakening US labor market outweighed inflation woes prior to the Federal Reserve’s policy meeting.
Annual headline consumer inflation in the US has picked up to 2.9% in August from 2.7% in July, in line with market consensus.
And, annual core CPI inflation has steadied at 3.1% in August.
Yet, initial jobless claims surged to 263,000 last week, indicating US labor market conditions softened markedly. The data followed last week’s employment report, which revealed a considerably slower than anticipated US job growth in August.
Markets are now pricing in about a 93% chance of a 25 basis point Fed rate cut next week and a 7% chance of a super-sized 50 basis point cut.
In the meantime, data out of Malaysia showed that retail sales in the country had risen 5.6% year-on-year in July, or at the fastest rate since March.
This followed a 5.4% YoY surge in June.
The exotic Forex pair lost 0.47% for the week.
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