New Zealand's central bank governor did manage to talk the...

New Zealand's central bank governor did manage to talk the country's high-flying currency a little lower last Thursday, despite keeping interest rates on hold, but some economists are demanding more.

The kiwi , as the New Zealand dollar is known, is down around 1.4 percent to 0.7275 since central bank governor Graeme Wheeler held rates at 2.0 percent, although he left the door wide open for a rate cut later this year.

The high kiwi dollar has long been a thorn in the central bank's side, curbing inflation and eroding export revenues.

On Thursday Wheeler reiterated that "a decline in the exchange rate is needed" but then came under fire for not doing enough to make it happen.

"Words are meaningless unless backed by a credible assault plan," said Jarrod Kerr, senior interest rate strategist at Commonwealth Bank of Australia.

New Zealand Manufacturers and Exporters Association Chief Executive Dieter Adam was equally unimpressed by the lack of action on the rates front.

"The current exchange rate means that the competitive position of New Zealand manufacturers and primary exporters is seriously affected," he said.

The dollar is shored up by strong economic growth with the New Zealand economy currently expanding at its fastest pace in two years, an improvement in commodity prices, and high interest rates in a world awash in negative or near zero rates.

Paul Dales, chief Australia and New Zealand economist for Capital Economics, said the only way the kiwi was going to fall to around US$0.65 was if the central bank cut rates to 1.5 percent or less from the current 2 percent.

He noted, however, the New Zealand central bank is in a "very tricky position," in particular given the U.S. Federal Reserve's power and influence over global interest rates.

While financial markets now widely expect the Fed to lift rates in December, the U.S. dollar came under pressure last week when the Fed trimmed its long-term rate expectations.

Some of the kiwi's recent strength is also tied to dairy prices reaching one year highs this month as a global supply gut showed signs of easing.

While some economists call for more action, the Reserve Bank of New Zealand remains reluctant to oblige.

Governor Wheeler told a parliamentary commission in August the economy would be "totally overheating" if the RBNZ were to slash interest rates.

He also noted he cut rates six times over the past 15 months and the kiwi is higher than it was when he started.

The bank's ability to make an interest rate decision and assume portfolio flows are going to give it the outcome it wants "is not necessarily guaranteed," said Wheeler.

The central bank has also been reluctant to stoke an already hot housing market. Last Thursday Wheeler reiterated that house price inflation remains excessive and created concerns about financial stability.

While currency market intervention is another option, it does not appear to be prominent on the bank's radar as it hasn't characterised the exchange rate as "exceptionally high" and "unjustified," two of the main criteria for intervention.

Commonwealth Bank's Kerr, however, vehemently disagreed that the Reserve Bank of New Zealand had no influence.

He called on the RBNZ to slash rates to 1.0 percent over two meetings and said it could intervene in currency markets. The central bank could also resolve to inflate the New Zealand economy with "freshly minted currency," if all else failed.

"Guerrilla warfare is the RBNZ's best tactic in fighting the currency trader," said Kerr.