Frustration at the lack of action from both the Reserve Bank and the Government in dealing with the country's monetary policy boiled over yesterday as the official cash rate stayed at 2.5%.
Council of Trade Unions economist Bill Rosenberg said it was time for the central bank to stop talking about the exchange rate being too high.
"Just do it. We welcome the acknowledgement the exchange rate is far too high.
"But it has been high for too long, hurting exporters and jobs, and the time for talking has passed."
While a further cut in the OCR might help, the effect would be marginal, he said.
It was time to look at other possibilities, such as selective tax on capital flowing into the country or limiting overseas borrowing by the banks.
In his official cash rate statement, Reserve Bank governor Alan Bollard left the OCR unchanged, saying inflation was restrained and was expected to stay near the middle of the bank's target range of 1% to 3%.
The domestic economy was showing signs of recovery. Housing market activity continued to increase and building activity appeared to be recovering, as forecast.
The global outlook remained of concern. Near-term indicators had moderated and financial-market sentiment was fragile.
"The New Zealand dollar has stayed elevated despite recent falls in commodity prices.
"Should the exchange rate remain strong without anything else changing, the bank would need to reassess the outlook for monetary policy settings," Dr Bollard said.
Economists seized on Dr Bollard's comments as indicating a rate cut could be in the offing.
Westpac senior economist Michael Gordon said the statement made no reference to the next move being up.
"Given that the 'outlook' in March was for little more than one 0.25% OCR hike a year over the next three years, any meaningful change to the outlook as a result of the strong exchange rate would likely have the Reserve Bank projecting rate cuts," he said.
On Monday, Prime Minister John Key dismissed calls for intervention to weaken the currency the stuff of "la la land", something thrown back to him yesterday by Labour finance spokesman David Parker and the left-leaning New Zealand Manufacturing and Exporters' Association.
Mr Parker said Mr Key's comments looked "extremely unwise" in light of the statement from Dr Bollard.
"For three decades, New Zealand has run a current account deficit because the value of our exports has not covered the cost of our imports, interests to overseas lenders and payments to the foreign owners after they buy New Zealand assets."
It was unbecoming of Mr Key to abuse the opposition, he said.
"The unwise substance of his comments is highlighted by Dr Bollard's statements.
"The Reserve Bank governor implements monetary policy but it is government's responsibility to make that policy. The National Government has not rebalanced the economy."
Manufacturing and Exporters' Association chief executive John Walley said Mr Key's "la la land stuff" comment was superficial and ignored the fact that the United States, the United Kingdom, Switzerland, Brazil, China and Singapore were all engaged in currency management.
"It seems that 'la la land' occupies a substantial part of the planet.
"As an exporter, the choice between the Swiss policy framework and New Zealand's is a no-brainer and it plays out in the long-run economic performance of the two economies."
A free floating exchange rate was good for currency traders and big economies but not for small export-exposed economies such as New Zealand, he said.
Mr Gordon said the Reserve Bank was now "firmly on hold", with the next move dependent on the exchange rate.
"We also regard exchange rate intervention as possible, given that all four of the Reserve Bank's pre-conditions have been met.
"The main argument against intervention is that the Prime Minister recently commented that it would be ineffective," he said.
