THE ringgit weakened against the US dollar at the start of trading on Friday as global currency markets turned defensive ahead of the release of closely watched United States employment figures that could shape expectations for future Federal Reserve interest rate decisions.
Investors remained cautious amid concerns that resilient economic conditions in the United States could strengthen the case for policymakers to maintain higher interest rates for longer, providing continued support for the greenback.
At 8am, the local currency slipped to 4.0120/0160 against the US dollar from Thursday's closing level of 4.0095/0140.
Market attention is firmly focused on the release of the US Nonfarm Payrolls (NFP) report later on Friday, a key indicator of labour market strength that often influences global currency movements and monetary policy expectations.
Bank Muamalat Malaysia Bhd Chief Economist Dr Mohd Afzanizam Abdul Rashid said economists were forecasting a moderation in job creation while expecting unemployment to remain unchanged.
“This will be the determining factor as elevated fuel prices would result in higher inflation, and steady labour market conditions could lead the US Federal Reserve to maintain its restrictive monetary policy stance,” he added.
The cautious tone across foreign exchange markets has also been reinforced by growing efforts among Asian governments and central authorities to support their respective currencies against dollar strength.
Afzanizam noted that the US dollar's advance against the Japanese yen had pushed the currency pair beyond the psychologically significant 160-yen threshold, prompting fresh warnings from Japanese authorities over potential intervention.
“India is mulling to scrap the capital gains on bonds to lure foreign investors. Hence, the currency market is likely to be guarded, and the ringgit is no exception either.
“This is especially true when political development, such as state elections, is taking shape,” he added.
Despite its softer performance against the dollar, the ringgit recorded gains against several major international currencies, reflecting broader volatility across global foreign exchange markets.
The local currency strengthened against the British pound, improved against the euro and also posted gains versus the Japanese yen.
Against regional peers, however, performance was mixed. The ringgit advanced against the Singapore dollar but weakened marginally against the Thai baht, Philippine peso and Indonesian rupiah.
Analysts expect currency markets to remain highly sensitive to developments in US monetary policy, inflation expectations and geopolitical events, with Friday's employment report likely to set the tone for trading across Asian markets in the coming sessions. - June 5, 2026
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