The coronavirus wreaked havoc in the emerging market currency complex in January. Only three of the 21 currencies tracked by S&P Global Market Intelligence gained against the U.S. dollar over the course of the month, with countries dependent on exports of commodities hit the hardest.

Efforts to contain the outbreak, which has killed 427 people, has dented economic activity in China, weighing on demand for global goods and services. The scale of the Chinese economy means that, unlike in 2003 during the Sars outbreak when China's economy was much smaller, a reduction in demand has major implications for the global economy.

The Dow Jones Commodity Index fell on Feb. 3 to its lowest level since July 2017, having shed 9.5% since the beginning of the year on expectations of reduced demand from China, by far the world's biggest importer of commodities including metals and oil.

South Africa, which exports gold, diamonds, and metal ores to China, had the worst-performing currency, enduring a 6.5% fall in the value of the rand in January.

"Even before the outlook for the global trade deteriorated due to the prospect of a much weaker growth in China in the first quarter, the South African manufacturing sector was already in a recession," said Piotr Matys, senior emerging markets FX strategist at Rabobank.

South African manufacturing PMI slumped to 45.2 in January from 47.1 in December, a sixth consecutive month below the 50.0 mark that divides expansion and contraction.

South Africa is a clear example of the relative effects of the coronavirus and Sars in 2003. In that time, South African exports to China have risen from $1.84 billion to $27.4 billion.

Real roiled

Brazil, which exports soybeans, iron ore and crude petroleum to China, also suffered, with the real shedding 6.1%, while the Chilean peso also fell 6.1% on the expectation of reduced demand for refined copper and copper ore.

China's yuan was one of three emerging-market currencies to gain against the U.S. dollar in January as agreement over a "phase one" China-U.S. trade deal and some improved economic data boosted the renminbi in the first half of the month.

As of Jan. 19, the yuan was up 1.5% on the dollar. But as the outbreak worsened, the People's Bank of China cut interest rates and injected $21.4 billion into money markets, helping it trim gains to just 0.4% at the end of the month.

The Indonesian rupiah ended January as the best-performing emerging-market currency, as the economy is one of the least impacted by Chinese tourism in the ASEAN region and investor sentiment was boosted by a $22.8 billion investment pledge by the United Arab Emirates.

The Israeli shekel was the only other emerging market currency with a positive performance in January, gaining 0.07%.