The NZ Herald reports that the world price for NZ’s commodity exports has surged by 17% in the past 6 months, evidently driven mostly by increased prices for dairy products as a result of increased use of feed corn in the US for in ethanol production.
This is interesting because it is one thing that potentially justifies an otherwise excessively high exchange rate. However it is also going to put further upward pressure on interest rates, which is likely to suppress property values. Coincidentally, the Herald also reported a few days ago predictions from Kieran Trass of Suburbwatch.co.nz that house prices are going to drop in the next few months.