The Reserve Bank of New Zealand has kept the official cash rate at its record low of 1.75 per cent.
In his first review of the year on Thursday morning, bank governor Graeme Wheeler left the rate unchanged - a move that was widely expected.
In his statement, Mr Wheeler said headline inflation had returned to the bank's target band of 1 per cent to 3 per cent and was expected to anchor around the 2 per cent midpoint in the longer term.
However, he lamented the on-going strength of the New Zealand dollar.
"The exchange rate remains higher than is sustainable for balanced growth and, together with low global inflation, continues to generate negative inflation in the tradables sector. A decline in the exchange rate is needed."
