NZ dollar weakens after Apple slashes sales forecast

The kiwi was trading at 64.12 US cents at 5pm. Photo / 123RF

The New Zealand dollar fell after technology company Apple warned its revenue will fall short this quarter because the coronavirus crisis is disrupting both production and demand in China.

The kiwi was trading at 64.12 US cents at 5pm in Wellington from 64.29 cents at the same time yesterday. The traded-weighted index was at 71.32 points from 71.37.

See live rates for the NZ-US $ below. Click for more information:

​

Apple said although factories in China are reopening, production is ramping up more slowly than expected, leading to shortages that will temporarily affect revenue worldwide.

With all Apple's stores in China shuttered, as well as many of its partners' stores, demand in China has also slumped.

"The situation is evolving," Apple said in a statement. "Apple is fundamentally strong, and this disruption to our business is only temporary."

The minutes of the Reserve Bank of Australia's last meeting on February 4, when it held its cash rate at 0.75 per cent, were also released today.

"Basically, they said they would've cut interest rates if it wasn't for the housing market. They were concerned about the housing market going into over-drive again," said Tim Kelleher, head of foreign exchange sales at Commonwealth Bank of Australia.

The RBA also appeared more concerned about the economic impact the virus will have than the New Zealand central bank demonstrated after its meeting last week, Kelleher said.

Air New Zealand also announced it is reducing its capacity to Hong Kong and Shanghai because of the virus's impact on demand.

"The market is slowly coming around to the view that it's going to be slower for longer" as a result of the virus, Kelleher said.

Earlier today, China's ambassador to New Zealand, Wu Xi, told journalists that 40 per cent of Chinese students who study in New Zealand are now stuck in China and that the New Zealand government should lift its ban on foreign nationals travelling from or through China.

The latest numbers from China are that almost 72,500 people have been infected and that the death toll is approaching 1,900. That's up from more than 1,700 deaths and 71,000 cases yesterday.

The New Zealand dollar was at 95.83 Australian cents from 95.61 cents at 5pm yesterday. It was at 49.31 British pence from 49.29, at 59.19 euro cents from 59.33, at 70.34 yen from 70.61 and at 4.4480 Chinese yuan from 4.4857.

The two-year swap rate eased to a bid price of 1.0830 per cent from 1.1110 yesterday while 10-year swaps fell to 1.4480 per cent from 1.4800.