US Dollar Hits Multi-Week High Ahead of NFP; Oil Rebounds on Inventory Draw

KUALA LUMPUR, 9 January 2026 – The US dollar index (DXY) strengthened 0.2% to 98.9, its highest since early December, as markets awaited December’s non-farm payrolls (NFP) report and a possible Supreme Court ruling on the legality of President Trump’s reciprocal tariffs.

Overnight US data showed the trade deficit narrowing sharply to USD29.4 billion in October—the lowest since 2009—while initial jobless claims rose slightly to 208k. Continuing claims climbed to 1.914 million, signalling cautious hiring amid steady layoffs.

US Dollar – Multi-week high

In fixed income, US Treasuries weakened slightly, with 10-year yields up to 4.17%, though longer bonds found support after Trump proposed purchasing USD200 billion in mortgage bonds to lower housing costs. Corporate bond issuance surged, hitting USD88.4 billion in the first three days of 2026.

Regionally, Malaysia and Türkiye signed seven cooperation agreements, with PM Anwar Ibrahim stating a USD10 billion bilateral trade target is achievable. BNM’s international reserves rose USD1.2 billion to USD125.5 billion as of end-December.

Oil prices rebounded 4% after a 3.8 million barrel US crude draw, despite potential Venezuelan supply increases.

MYR softened 0.1% amid firm dollar sentiment, while Ringgit bonds traded range-bound ahead of US data. (182 words)