New Zealand will move to level 3 of lockdown on Monday, April 27 at 11:59pm. Alert level 3 will be held for two weeks and then Cabinet will assess whether to move down another level.
The New Zealand dollar spiked higher after Prime Minister Jacinda Ardern announced the lockdown will be eased from midnight on April 27.
The kiwi was trading at 60.51 US cents at 5pm in Wellington from 60.22 immediately before the announcement. That was up from 60.30 US cents in New Yorkon Friday and 60.18 at 5pm locally on Friday. The trade-weighted index was at 68.76 from 68.36.
Ardern said the country will move from level 4 to level 3 in a week's time, which will mean a number of industries including construction and takeaway food operations can resume.
It will remain at level 3 for at least two weeks and that will be reviewed on May 11, she said.
Ardern said waiting until Monday night rather than Wednesday - which will be the end of the fourth week in lockdown - means only two extra business days but will give New Zealand a better chance to lock in the gains of the shutdown and make it less likely the country will have to return to full lockdown. Monday is a public holiday in New Zealand.
Her announcement came after New Zealand announced nine more people have been infected with the coronavirus, the second consecutive day the numbers have been in single digits, taking the total to 1,440 while the death toll remained at 12.
Ardern also clarified what the government's aim is: "Elimination doesn't mean zero cases, it means zero tolerance" and the government will be tracing and isolating the contacts of any new cases so that the disease is stamped out.
"I guess the fact that they gave firm guidance" on when the lockdown would end was enough to inspire the currency to rally, even though some may have been disappointed it won't end on Wednesday, said Mike Shirley, a dealer at Kiwibank.
"It's positive, but exactly how positive it is remains to be seen. It will be up to the northern hemisphere to decide," Shirley said.
The signals from offshore are somewhat confused with oil prices under pressure again while equities in the US remain buoyant in the midst of its company reporting season.
Few people will pay much attention to companies' historical financial data, "it will be more about what's the road map moving forward for those companies," Shirley said.
The announcement of NZ's latest inflation data was taken little notice of, although it finally made it above the middle of the Reserve Bank's 1 percent to 3 percent target range.
Consumer prices lifted 0.8 percent during the quarter, bringing annual inflation to 2.5 percent. That was the highest annual measure since September 2011 when it was 4.6 percent.
Economists expect this will be short-lived as the coronavirus crisis means deflation could be looming.
Reserve Bank governor "Adrian Orr did it, he did it, but now nobody cares or will remember all the hard work it took to achieve," Shirley said.
The New Zealand dollar was trading at 95.22 Australian cents from 94.52 cents at 5pm on Friday. It was at 48.49 British pence from 48.14, at 55.65 euro cents from 55.35, at 65.23 yen from 64.83 and at 4.2815 Chinese yuan from 4.2591.
The bid price on the two-year swap rate closed at 0.3125 percent from 0.3300 on Friday, while 10-year swaps were at 0.8500 percent from 0.8950.
