KUALA LUMPUR (May 30): The ringgit weakened against the US dollar as Malaysian shares fell after the US Federal Reserve Chair Janet Yellen said the country's interest rate may rise in the "coming months". 

At about 10am, the ringgit weakened to 4.1035 against the US dollar. The exchange rate so far today was between 4.0835 - 4.1080.

The FBM KLCI fell 11.92 points to 1,625.27 at 10:18am.

Reuters, quoting Yellen last Friday, reported that the Federal Reserve should raise interest rates "in the coming months" if the economy picks up as expected and jobs continue to be generated , bolstering the case for a rate increase in June or July.

"It's appropriate ... for the Fed to gradually and cautiously increase our overnight interest rate over time, and probably in the coming months such a move would be appropriate," Yellen said during an appearance at Harvard University.

Today, MIDF Amanah Investment Bank Bhd wrote in a note that the research firm was maintaining its expectation that the Federal Reserve would raise the US' interest rate by 25 basis points (bps) this September.

"At the moment we are maintaining with our expectation that the Fed will conduct an interest rate hike in September by 25 bps, as we opine that the Fed will reiterate their stand that a rate hike is likely this year in June FOMC (Federal Open Market Committee) meeting in order for the market to price in the September rate hike.

"As of now, only 30% of traders expect that the Fed will increase the rate in June," MIDF said.