I'm U.S. dollar bullish over the next three months, largely because the Fed will go to 4.75 percent and they'll leave the door open to 5 percent.

He doesn't want to see lightening strike twice, and risk giving the housing market another wind.

There's not a lot of investment opportunities out there, so yield is still the default play for the market. But when the New Zealand dollar turns, it will turn aggressively, and if we don't get yield demand it will fall by a country mile.

He's delivering a warning shot. The message is that they don't appear to see any problem with having monetary policy in a restrictive stance for some time.

It's a question of relative risks and Bollard is more mindful of inflation. He will be comfortable with receding growth.

The Reserve Bank of New Zealand is expected to reaffirm its no-cut stance, cementing yield-related strength for a while yet.