New Zealand’s dollar, the best-performing major currency this year, is too strong and this poses a challenge for the nation’s exporters, according to Finance Minister Bill English.
“It’s a bit too high,” he said today in an interview in Hong Kong, where he is attending the Credit Suisse Asian Investment Conference. “It makes it difficult for our economy to rebalance.”
New Zealand’s dollar climbed to an 11-month high of 86.40 U.S. cents on March 18 as traders boosted bets that the Reserve Bank of New Zealand will raise interest rates next month. Governor Graeme Wheeler lifted the official cash rate by a quarter point on March 13, becoming the first central banker from a developed nation to tighten this year, and signaled further increases as inflation pressure builds.
The central bank sets monetary policy independently of the government and focuses on limiting annual inflation to 2 percent, a target English said today he is satisfied with.