Why further increases in the dollar have less impact

Somewhat ironically, one of the features of having the NZ dollar at such a high level, is that further increases have less of an impact.

Let’s say you sell widgets for US$100 each.  Having the NZ$ go from US$0.50 to US$0.60 reduces your income by $33.33.

But having the NZ$ go from US$0.70 to US$0.80 only reduces your income by $17.86.

Now of course in absolute terms you are always worse off (if an exporter) the higher the dollar is, but the relative change is far worse going from 0.50 to 0.60 than 0.70 to 0.80.