The USD/MYR currency pair settled at Friday’s low of 4.2200, its weakest level since October 10th, as the latest US CPI data added to expectations of more Federal Reserve interest rate cuts.

The report, which has been delayed by the US government shutdown, showed that annual headline consumer inflation had picked up to 3% in September, the highest rate since January, from 2.9% in August. Yet, the acceleration was slower than forecasts of 3.1%.

Annual core CPI inflation eased to 3% in September from 3.1% in August.

Markets are now pricing in about a 94.5% chance of a 25 basis point Fed rate cut in October and a 92% chance of another 25 bps cut in December.

Meanwhile, annual consumer price inflation in Malaysia was reported to have picked up to 1.5% in September from 1.3% in August. It has been the highest annual inflation since February.

Market consensus had pointed to an acceleration to 1.4%.

Malaysia’s annual core CPI inflation, which excludes fresh food items and administered costs, picked up to 2.1% in September, or the highest since October 2023.

Developments surrounding US-China trade negotiations also remain in focus. US President Donald Trump is to meet Chinese President Xi Jinping next week as part of a trip to Asia. Trump has said he expects to secure a fair trade deal with China.

The exotic Forex pair lost 0.10% for the week.