According to the Financial Times, the Fed is likely to project about a 6 per cent decline in the US economy for 2020 with the jobless rate settling at about 10 per cent or 11 per cent.
The Fed has already ruled out moving to negative interest rates.
Fed chair Jerome Powell may repeat previous pleas to congress to provide more fiscal support, although after last week's surprisingly strong non-farm payrolls data, such pleas could fall on deaf ears in the Republican-controlled senate.
The Fed is also likely to repeat previous comments that the US economic recovery from the coronavirus crisis will be slow.
"All eyes are focused squarely on the Fed tomorrow. It's all going to depend on what the Fed says," said Tim Kelleher, head of foreign exchange sales at Commonwealth Bank of Australia.
"Until then, we will just wash around with whatever the Dow futures are doing," Kelleher said.
The Dow futures were up about 0.5 per cent a short while ago.
The kiwi has risen from below 60 US cents since mid-May and reached a high at 65.82 cents yesterday and so was due for some consolidation.
The New Zealand dollar was trading at 93.62 Australian cents from 93.55 cents yesterday. It was at 51.23 British pence from 51.48 pence, at 57.54 euro cents from 57.94 cents, at 70.22 Japanese yen from 70.61 yen and at 4.6180 Chinese yuan from 4.6297 yuan .
The bid price on the two-year swap was 0.2300 per cent from 0.2325 per cent, while the 10-year swap was at 0.8475 per cent from 0.8500 per cent yesterday.
