The market has shrugged off the positive impact of the Reserve Bank's upbeat monetary policy statement on Wednesday and is back to monitoring global developments related to the virus, "particularly with the confusion around the revisions to the data," said Hamish Pepper, fixed income and currency strategist at Harbour Asset Management.
On Thursday, China shocked the market by announcing a further 15,000 people had been infected by the virus, nearly 10 times the number of new cases announced on Wednesday. Chinese authorities said they had changed the way they report cases.
The official figures show the virus has now killed almost 1,500 people with 65,000 infected, mostly in China, but with cases reported in about 30 countries. After Thursday's shock, many are doubting China's figures.
"The bias is probably for a weaker currency in light of global concerns. It's hard to see that changing meaningfully until we get more certainty on the economic impact. That's what the market is really searching for," Pepper said.
Everybody is expecting a big hit to March-quarter growth globally but there are questions about whether that persists into the second quarter, he said.
Yesterday, international ratings agency Standard & Poor's said it expected the virus would shave 0.5 per cent off Australia's GDP in 2020 and New Zealand economists have made similar forecasts for the New Zealand economy.
The New Zealand dollar was at 95.69 Australian cents from 95.97 cents at 5pm yesterday. It was at 49.32 British pence from 49.79, at 59.38 euro cents from 59.35, at 70.64 yen from 70.84, and at 4.903 Chinese yuan from 4.5010.
The two-year swap rate eased to a bid price of 1.1309 per cent from 1.1600 yesterday while 10-year swaps fell to 1.5000 per cent from 1.5300.
