The Reserve Bank is expected to keep the official cash rate on hold at 2.5% at the October review on Thursday, with the strong New Zealand dollar a key focus.
Economists say the biggest change since the September Monetary Policy Statement has been a sharp appreciation in the Kiwi, mainly due to events in the United States.
The US dollar has been weak because of the Federal Government partial shutdown and the expectation that the Federal Reserve will delay winding down its easy money policy, keeping interest rates low.
The New Zealand dollar fell sharply late last week, partly due to market speculation that the Reserve Bank's loan restrictions could mean interest rates won't rise as high as previously thought.
ASB Bank senior economist Jane Turner says the stronger New Zealand dollar will dampen inflation pressures by lowering the cost of imported goods, and continues to expect the Reserve Bank will wait until March before lifting the Official Cash Rate.
