A bank economist says the high New Zealand dollar is still the major challenge for the country's burgeoning economy.
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GDP growth is forecast to reach 3.4 percent this year, up from about 2.5 percent last year.
Several economic surveys have put business confidence at a 20 year high.
But the ASB's chief economist Nick Tuffley told Nine to Noon the economy is still at risk from the effects of the strong New Zealand dollar, which is staying high because of sluggish growth in other economies.
Mr Tuffley says businesses simply have to live with that until the rest of the world gets on a stronger footing and the exchange rate falls.
However, he says the dairy sector is mostly shielded from the effects of the high dollar.
