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.
A rate rise at Wheeler’s April 24 review is a certainty,
according to swaps data compiled by Bloomberg. Eleven of 15 economists surveyed
by Bloomberg forecast an increase.
New Zealand’s dollar has gained 4.6 percent against the U.S.
currency this year, the most among 16 major currencies tracked by Bloomberg. It
bought 85.93 U.S. cents at 3:35 p.m. in Hong Kong.
