Reserve Bank of New Zealand Chief Economist Paul Conway on Thursday said interest rates were clearly in the contractionary territory and causing a welcome slowdown in demand in the economy, though it was not yet clear that inflation expectations were under control, as Reuters reported. 

He was also reported saying that the 450 basis point rise in interest rates over the last 18 months was still "percolating" through the economy and would likely further weigh on consumer spending.

Reuters noted that he said that it was unclear whether inflation expectations were falling fast enough to mean current and projected rate setting were high enough to be disinflationary.

NZD/USD update

The NZ Dollar flew to a fresh high for the month at 0.6282 and was up from a low of 0.6171 on the back of a dovish Federal Reserve on Wednesday. 

The bulls are moving back in on Thursday and eye a break of the 0.6280s.