Countries like Australia, New Zealand and South Korea are among the few which managed to buck the trend and put a lid on the coronavirus outbreak, at least for now. Their success has boosted investor confidence and it's showing in the strength of their currencies.
With their economies re-opening again, their currencies have significantly jumped from earlier this year when the outbreak ravaged the Asia Pacific region. In contrast, many of their neighbors in the region are still struggling to control the pandemic.
"New Zealand and Australia have been very effective in controlling COVID-19 and are ready to restart their economies," Kathy Lien, managing director of foreign exchange strategy at BK Asset Management, wrote in a note last Friday.
"In Australia, AUD (the Australian dollar) soared despite weaker PMIs after Prime Minister Morrison said they are headed for a COVID safe economy," she said. Purchasing Managers' Index (PMI) is an economic indicator of how well the manufacturing sector is performing.
"The fact that these countries are ready to restart activity after effectively controlling COVID-19 (and not before) means that they are leaps and bounds ahead of the US in terms of economic recovery, which should be wildly positive for their currencies," Lien said.
"There is also a notion that Asia has controlled the virus more effectively than the US and Europe," said Tapas Strickland, director of economics and markets at the National Australia Bank, in a Tuesday note on the recent strengthening of the Australian dollar.
The U.S. has the most number of reported cases worldwide with at least 988,000 infections and 56,200 deaths, according to Johns Hopkins University data as of Tuesday morning. Spain, Italy, France and Germany are the other countries most badly-hit by the pandemic. Worldwide, there are more than three million confirmed cases, and at least 211,159 deaths, according to the data.
In addition, Australia and New Zealand have many of their major export destinations emerging from lockdown sooner than the U.S. and much of Europe, ANZ Research's Foreign Exchange Strategist, John Bromhead, wrote in a Friday note.
China, the largest trading partner of both countries, has restarted production as reported cases slow to single-digit levels, with no new deaths for more than a week. The first coronavirus cases were reported in the country in December.
"Australia and New Zealand are in a relatively solid position. Both have strong virus containment, relatively high shares of primary industries sheltered from the consumer-centric slowdowns, and strong fiscal responses," Bromhead wrote.
The Australian dollar was one of the region's worst-performing currencies last year, on the back of concerns over its slowing economy and that of China's – its largest trading partner.
At the start of 2020, it was as high as $0.70 against the U.S. dollar — but plunged to a low of $0.5798 in mid-March as virus concerns took hold. Since then, it has surged 11.4% and last changed hands at $0.6460.
Australia acted swiftly when the outbreak surfaced in the country, closing off its borders and imposing movement restrictions. This week, its daily new cases came down to single digits, and Australia said it will start easing some restrictions.
The country has a total of 6,721 cases and 83 deaths as of April 27, according to Hopkins's data.
At around mid-March, New Zealand's currency was at a low of $0.5666. It has since gained about 6.4% to above the $0.60 level.
The country lowered its alert level on Monday, allowing gatherings of up to 10 people and permitting businesses to reopen, though they cannot physically interact with customers. The country had previously raised its alert level to the highest alert level, which meant no gatherings were allowed and all non-essential businesses to close.
New Zealand has managed to keep numbers low compared to the rest of the region, after decisively locking down the country soon after the first cases surfaced. It recorded 1,472 confirmed cases, and 19 deaths as of April 27, according to Johns Hopkins.
From initially being Asia's worst-hit country outside China, South Korea is now hailed as a role model for successfully containing the outbreak, after it instituted widespread testing and intensive contact tracing.
It has since eased restrictions, with the situation in the country a stark contrast to the rest of the world: People have started going out to malls and restaurants again, and are returning to work.