UNITED STATES (OBSERVATORY NEWS) — Asian currencies fell on Monday as the rapid spread of the Coronavirus outside China led to concerns about a pandemic and prompted investors to seek safe haven assets in gold, the dollar and the Swiss franc.
Italy, South Korea and Iran recorded significant increases in the number of injuries during the weekend. South Korea currently has over 760 cases, in Italy more than 150 and in Iran 43.
The World Health Organization is currently concerned about the growing numbers of infections that do not have a direct relationship with the outbreak in China.
The currencies of China, Australia and New Zealand fell, as did the currencies of emerging markets.
The Australian dollar hit its lowest level in 11 years in early trading, and the New Zealand dollar fell half a percent, before recovering slightly, along with the yuan, with news of Chinese regions reducing contingency restrictions.
But that facilitation provided little support elsewhere, with the South Korean won dropping nearly 1 percent to its lowest level in six months. The Indonesian rupee, largely protected by its relative independence from Chinese trade, tracked public sales in emerging markets, falling 1 percent.
Against a basket of currencies, the US dollar returned to its nearly three-year peak, the level it touched last week.
The dollar rose against the euro to 1.0820 dollars and sterling against 1.2942 dollars, while the Swiss franc attracted some flows seeking safe haven as well and rose 0.3 percent with the rise of the dollar. Against the euro, the franc stabilized at the highest level in four and a half years.
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