How the coronavirus outbreak is impacting world currencies

The Coronavirus is spreading across the world and the human cost is significant, with cases now appearing outside of China in the UK, the US – more than 25 countries in total at the time of writing. The World Health Organisation has designated the outbreak as a global health emergency.

So what’s the connection between a health epidemic and world currencies? The global economy is now so interlinked that a significant event in one of the major economies filters through to other economies. There is particular pressure on the Australian and New Zealand dollar; as commodity currencies, their strength is closely linked to the performance of the Chinese economy.

How much have the Australian and New Zealand dollars declined?

Since the Chinese government announced it had detected a new strain of virus which was a Coronavirus on January 7, the Australian dollar has fallen by almost three cents against the US dollar, from US$0.6929 on January 6 to US$0.6694 on February 2. Over the same period, the New Zealand dollar has fallen around two cents from US$0.6665 on January 6 to US$0.6463 on February 2. Both currencies have fallen against other pairs across the board. For example, over the same period the Euro has risen more than 1.6% against the Australian dollar from 1.6135 on January 6 to 1.6405 on February 5.

What should I do if I need to trade into or out of Australian or New Zealand dollars?

First of all, don’t panic. OFXperts are on hand 24/7 to guide you through your options. We understand that a developing situation like the Coronavirus can be worrying on several levels, but if you are a business needing guidance or an individual who needs to send money abroad, we have the expertise and tools to help you. Get in touch with OFXperts worldwide in one of our regions contact numbers or email your dedicated account manager Samuel Pitt at samuel.pitt@ofx.com below or by email at customer.service@ofx.com.