Kuala lumpur: The ringgit closed higher against both major and regional currencies on Monday, buoyed by softer US economic data which has reduced market expectations for a potential US Federal Reserve interest rate hike in September. At the close of trading, the ringgit had surged 225 percentage-in-points (pips) to 4.0585/0630 against the US dollar, compared to last Friday's close of 4.0840/0885.

According to BERNAMA News Agency, Bank Muamalat Malaysia Bhd chief economist Dr. Mohd Afzanizam explained that weaker US consumer price index (CPI) and jobs data from the previous week have diminished the likelihood of a rate hike by the Fed next month. "The odds for a rate hike in September have decreased to 30 percent from over 50 percent a month ago," he stated, adding that this shift in sentiment towards the Fed Funds Rate could bolster the ringgit in the near term.

The US CPI reportedly rose by 0.1 percent in July, which increased annual inflation to 3.4 percent. Meanwhile, nonfarm payrolls declined by 23,000 in July, a stark contrast to economists' predictions of an increase of around 80,000 jobs.

At market close, the ringgit saw gains against a basket of major currencies. It appreciated against the Japanese yen to 2.5496/5526 from 2.5660/5690 and strengthened against the British pound to 5.5021/5082 from 5.5232/5293. The ringgit also climbed against the euro to 4.7062/7115 from 4.7182/7234.

Regionally, the local currency performed well against its counterparts. It marginally rose against the Philippine peso at 6.60/6.61 from 6.64/6.66 and edged up against the Thai baht to 12.2948/3136 from 12.3153/3333. Additionally, it gained ground against the Indonesian rupiah to 228.0/228.3 from 229.0/229.4 and climbed against the Singapore dollar to 3.1804/1842 from 3.1924/1964.