effects of the ultra-accommodative monetary policy stance may increase over time. Yet, higher interest rates are not likely to be to everyone’s liking. Given the high level of government debt, central banks could find themselves coming under increasing pressure to pursue an accommodative monetary policy for longer than necessary.
In the June MPS we described it as overvalued and suggested that a significant downward adjustment was justified and necessary to put New Zealand’s net external position on a more sustainable path. Since the June MPS, the exchange rate has  6  Wheeler (2015), ‘The outlook for the New Zealand economy’, speech on 4 February 2015.