1 Introduction
Both the level of the exchange rate and exchange rate cycles receive much attention in public discussion. This paper seeks to understand the extent of New Zealand's exchange rate fluctuations relative to other economies, and what drives these. This paper is aimed at a non-technical but interested audience. It aims to facilitate informed discussion and greater transparency around a complex issue of interest to all New Zealanders.
A companion paper New Zealand's Exchange Rate Cycles: Impacts and Policy (Mabin, forthcoming) discusses the impact of New Zealand's exchange rate cycles on exporters and the wider tradable sector, and potential policy options for mitigating exchange rate variability.
