Prime Minister John Key says the rising New Zealand dollar will dampen economic growth if the currency cannot be brought under control, Reuters reports.
Answering questions following a speech to the US Chamber of Commerce, Key acknowledged the high NZ dollar, which hit 86.4 US cents overnight, was hurting the economic recovery.
"There's no getting away from the fact [that the current high exchange rate] is very difficult for our non-commodity-linked exporters," Reuters reported Key saying.
"We haven't seen these levels since the 70s ... and it is going to dampen our economic growth if we can't get it under control," Key said.
Key told Chamber members the US Federal Reserve's quantitative easing policies had the effect of devaluing the US dollar, which was pushing New Zealand's currency up.
"That obviously has concerns from an exchange rate point of view from our perspective," Key said.
However US policy makers had to make their own judgements about what was best for the US economy, Reuters reported him saying.
Key was later quoted by Radio NZ as saying there were benefits to a high currency.
"Obviously it has some benefits in terms of imported components," he says. "It takes some pressure off clearly - oil prices and the likes - but we are seeing in areas like tourism, export education and some of our other areas where there's no commodity link a tremendous challenge. And we havn't seen these levels since the 70s."
(Updated with comments quoted via Radio NZ)
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