Parliament is going to debate a bill designed to give the Reserve Bank authority to control the exchange rate.
The bill, drafted by NZ First leader Winston Peters, has been drawn from the members ballot and will go on parliament's agenda for a first reading.
Under current law the bank can intervene in extreme circumstances but Mr Peters says it needs more flexible powers.
"Everyone, from the International Monetary Fund to local economists, agree our exchange rate is seriously over-valued by about 20 per cent," he said on Thursday.
"It is crippling our international competitiveness and severely distorting and damaging our economic prospects."
Mr Peters says the bank's historic role is to keep the rate of inflation between one and three per cent.
"It was legislated for in the 1980s during the time of Rogernomics and rampant inflation," he said.
"While the inflation goal remains important, this bill would provide the Reserve Bank with the flexibility it needs to also promote growth and employment and boost our struggling export sector."
Mr Peters says his bill is a "golden opportunity" to put the economy on a track to prosperity but the government isn't likely to allow an opposition party to meddle with monetary policy.
The bill will almost certainly be defeated on its first reading vote.