The New Zealand dollar's week-long rally ran out of puff today as the mood in equities markets turned sour.
The kiwi was trading at 60.89 US cents at 5pm in Wellington from 61.44 at the same time yesterday. The domestic currency rose as high as 61.69 US cents overnight but now looks likely to end the week much closer to the 60.17 level it finished at in New York last Friday.
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The trade-weighted index was at 68.71 from 69.11.
"People are tired, perhaps, Friday. The kiwi sagged all day from early morning our time. Equities and the S&P futures are down and that tells you the story: risk off, sell kiwi," said Imre Speizer, currency strategist at Westpac.
One of the reasons the US equities markets lost ground was Amazon's reminder of the impact of the coronavirus on the world economy.
Although the digital giant's first-quarter sales topped analysts' expectations as consumers flocked online amid the coronavirus crisis, earnings were lower than expected as Amazon incurred costs to adapt to the pandemic.
It said it plans to spend at least US$4 billion ($6.5b) – all its forecast second-quarter operating earnings – on coronavirus-related expenses.
Chief executive Jeff Bezos told shareholders "you may want to take a seat, because we're not thinking small.
"Under normal circumstances, in this coming second quarter we'd expect to make some US$4b or more in operating profit," he said.
"But these aren't normal circumstances. Instead, we expect to spend the entirety of that US$4b, and perhaps a bit more, on Covid-related expenses getting products to customers and keeping employees safe."
Further evidence of how the disease is ravaging the world's largest economy will come later today when the Institute for Supply Management releases its manufacturing report – it is expected to show US manufacturing activity in April contracted further to 37 points form 49.1 in March – a reading below 50 indicates contracting activity.
Meanwhile, the grim statistics on the toll the virus is taking on the United States continue to escalate – it now has nearly 1.1 million people reported to be infected, a third of the reported cases globally, and nearly 64,000 people have died since early March.
New Zealand reported three new cases today, taking the total infected to 1,479, while deaths were unchanged at 19.
The New Zealand dollar was trading at 94.17 Australian cents from 93.60 cents at 5pm yesterday. It was at 48.44 British pence from 49.27, at 55.60 euro cents from 56.55, at 65.21 yen from 66.44 and at 4.2988 Chinese yuan from 4.3328.
The bid price on the two-year swap rate closed at 0.1700 per cent from 0.1425 per cent yesterday, and 10-year swaps were at 0.7025 per cent from 0.7675.