The Aussie has lost 3.9% so far this month, the second worst performing currency in the G10, behind only a 4.3% fall in the Norwegian crown.

Today the Australian dollar fell to an eleven-year low reaching 0.6635, slumping to levels not seen since before the GFC in 2009.

The picture is similar against a host of other currencies as the US dollar continues its march higher versus other units such as sterling, euro and New Zealand dollar.

The US dollar held near a two-month high against a basket of major currencies while the Australian dollar and the yuan were under pressure on Thursday as investors tried to shield themselves from assets that could be hit by China’s virus epidemic.

The U.S. Federal Reserve, while keeping interest rates on hold as expected on Wednesday, also cited the virus as a source of uncertainty for the economic outlook.

As the new pneumonia-like disease spread quickly in China, the dollar is emerging as an ultimate safe-haven destination.

“While it is highly uncertain how much the disease will spread and how hard it will hit the economy, downgrades to the Chinese economy look inevitable,” said Minori Uchida, chief currency analyst at MUFG Bank.

Indeed, a Chinese government economist said China’s economic growth may drop to 5% or even lower due to the coronavirus outbreak, possibly pushing policymakers into introduce more stimulus measures.

That would deal a severe blow to other economies that rely heavily on Chinese demand.

The Aussie has lost 3.9% so far this month, the second worst performing currency in the G10, behind only a 4.3% fall in the Norwegian crown, which has been hit by falls in oil prices.