Bollard confounds his critics

In June this year the Reserve Bank of New Zealand started intervening in the foreign exchange markets in order to curb the strength of the currency. It was the first time since the New Zealand dollar was floated in 1985 that the central bank stepped into the foreign-currency market in such a manner and the decision was explained in an article1 by a deputy governor, Grant Spencer, on 27 June. The Reserve Bank, he argued, believed the exchange rate was not sustainable at the record levels preva