FORMER N.Z. PREMIER CALLS FOR CHEAPER CURRENCY
Former Prime Minister Robert
Muldoon, an outspoken advocate of a managed float for the N.Z.
Dollar, said the currency is at least 10 pct overvalued.
    Muldoon said in a speech last night the exchange rate
should be around 48 U.S. Cents instead of the current 57 cents.
    "A reasonable value for the New Zealand dollar would be
between 10 and 15 pct less and nearer 15 than 10. Perhaps
around about 48 cents," he said.
    The Labour Party government removed exchange controls and
floated the dollar two years ago when it was worth 44 cents.
    Muldoon has no rank in the opposition National Party, and
party leaders, with an eye to general elections to be held by
September, have rejected his calls for a managed float.
    He said the dollar was high because of "grossly excessive"
interest rates for government stock.
    "I know of no other country which is implementing such a
free floating policy," he added. "There is widespread agreement
internationally that we have no alternative to floating
currencies in the short to medium term. But we need more
effective methods of managing them so as to limit the
volatility which has caused so much concern and damage."
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