And wherever I travelled in New Zealand outside Auckland I was met by people asking why they had to face high real interest rates and a rising real exchange rate when, they claimed, the only inflationary pressures in the country were in Auckland. And always my answer was the same.
All the parts of New Zealand are in a currency union, and it simply is not possible for the central bank to deliver different interest rates, or different exchange rates, to different parts of that currency union. The same reality is relevant today.