Finance Minister Bill English says manufacturers calling for a lower exchange rate are calling for their workers' wages to be cut.

Appearing before the Finance and Expenditure Select Committee, English faced a grilling about the Government's unwillingness to intervene in the currency markets to attempt to lower the New Zealand dollar.

Opposition MPs, who have been taking part in an inquiry into manufacturing in recent weeks, said the manufacturing industry had been warning that the high exchange rates was eroding profits and putting off any investment. English responded that the industry was effectively calling for lower wages for workers.

"What they're actually telling you is they want to cut the real wages of their workers, because that is the other side of the equation. They want to cut the real wages of their workers," English said.

English said the strong exchange rate was helping maintain household living standards.

"The exchange rate amounts to the purchasing power of New Zealand household and one of the reasons that households have got through the recession in reasonable shape is that the exchange rate has, where it is, helped maintained their standard of living."

English later said that he would prefer if the New Zealand dollar was weaker, but denied he wanted to cut wages.

Labour finance spokesman David Parker dismissed the comments as "nonsense".

"What they [manufacturers] want is an exchange rate which enables them to compete internationally so they can afford to pay wages," he said.

"The idea that an artificially high exchange rate is good for New Zealand workers because it holds down the price of flat screen TVs is a nonsense if they can't earn a decent wage."

- © Fairfax NZ News