The New Zealand dollar is on a downward path and likely to be below US80c by the end of next year - but there are differences in the forecasts of just how low the dollar will go.
Bank of New Zealand economists believe the kiwi could reach US73c by the end of next year while ASB has its forecast at US79c.
BNZ currency strategist Raiko Shareef said factors abroad had been the larger influence in the recent downward progress in the NZ-US dollar exchange rate.
The greenback had rallied broadly as more market participants bought into the view the US Federal Reserve would formally incorporate the risk of earlier rate hikes in its policy meeting next week.
Locally, the continued softening of domestic data built the case for the Reserve Bank to temper its aggressive track of projected interest rate rises, Mr Shareef said.
''And that is exactly what the bank delivered at its September policy meeting, lopping 0.5% off its rate track by December 2016.''
The overall tone of the Reserve Bank commentary was one warning of down-side risks to the updated projections. That helped limit the dollar upside.
Regarding the dollar, Reserve Bank governor Graeme Wheeler was no less vitriolic than he was in June, calling the dollar's strength ''unjustified and unsustainable'', Mr Shareef said.
It was important to point out the political risk in New Zealand.
While polls had narrowed, a largely unchanged government looked the likely outcome from Saturday's election.
It would take a combination of further poll tightening and markedly higher international coverage before the kiwi was affected to any significant degree, he said.
''For one thing, any pre-election impact should be overshadowed by the September 17 Fed meeting, where the market is expecting the Fed to strike a more optimistic beat.''
That would vindicate the US dollar rally and give it reason to extend further.
BNZ saw the kiwi at US73c by the end of next year, Mr Shareef said.
The proportion of businesses intending to hedge the New Zealand dollar is holding steady but there is a continuing divergence between the intentions of importers and exporters.
The ASB kiwi dollar barometer showed an increase in the proportion of importing firms planning to hedge their foreign exchange (FX) exposures and with that group planning to hedge, the percentage of their FX flows being hedged was also getting higher.
In contrast, the pattern of falling interest to hedge among exporters continued. However, for exporting firms continuing to hedge their FX exposures, the proportion of FX being hedged had lifted.
ASB Bank chief economist Nick Tuffley said the survey period of July 21-28 included the July Reserve Bank official cash rate review and the dollar did drop sharply over the week - from above US87c at the start of the period to US85.55 by the end.
''Regardless of size or business type, the clear expectation is the dollar is going to ease.
"By September 2015, businesses, regardless of type and size, are on average expecting the dollar to be below US80c.
"The expectation is consistent with ASB's own September 2015 quarter-end forecast of US79c.''
Details within the survey showed the proportion of exporters planning to hedge fell to 54.5% from 58.6% in the previous quarter.
Since early 2013, there had been a marked drop in the proportion of exporters planning to hedge.
About 70% of exporters indicated intentions to hedge in the first quarter last year.
The proportion of importers planning to hedge continued to edge up, with 93.4% indicating their intentions to hedge their FX exposures.
That was slightly higher than the 92.2% of exporters indicating plans to hedge in June this year.
