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Politicians do not usually discuss the future of the nation's currency - but when you have been a money market trader like Prime Minister John Key, it is hard to resist.
Key is predicting that the New Zealand dollar is likely to drop below 50 US cents at some stage in the future.
Speaking on TVNZ's Agenda, Key said the currency has a history of being overdone and underdone - but says exporters will be happy with where the currency is at.
"My personal view is [the dollar] will go lower," Key says.
"I've always thought it will print a four in front of it at some point against the US dollar, and probably a seven when it comes to the Australian cross rate."
"Four in front" is trader speak for somewhere in the 40 cent range. The Kiwi dollar has already dropped 30% this year to sit at 53 US cents, and economists, such as the ASB's Nick Tuffley, believe the slide is not over.
"The first half of next year is when we're likely to see the New Zealand dollar bottom out against the US dollar in our view, and certainly something below fifty cents," Tuffley says.
Key expects the Reserve Bank Governor to lower interest rates again in response to the global recession.
But has he breached political protocols by talking about money markets?
"I think in this case [Key] has been asked in more of a sense of a personal opinion from someone who has actually had quite a lot of experience in foreign currency markets," says Tuffley.
"So it doesn't look like it is any attempt to do anything other than express a personal view."
