On Friday, the U.S. Bureau of Economic Analysis is scheduled to post the preliminary GDP data for the first quarter of 2021. The consensus forecasts project no changes from the advanced growth numbers that were posted a month earlier.
Thus, the American economy is expected to have grown 6.4 per cent in the three months leading to March, following a 4.3 per cent expansion recorded in Q4.
Preliminary GDP data is published roughly one month after the advanced numbers and one month before the final reading, making it an important measurement of growth.
Because of these discrepancies, the dollar is unlikely to be affected greatly by the GDP data. Even still, any unexpected findings on Friday could stir some extra volatility on the already reeling greenback.
The Governing Council of the Reserve Bank of New Zealand is meeting on Wednesday to deliberate on its current monetary policy stance. The Council is almost certainly going to maintain the near-negative Official Cash Rate unchanged at 0.25 per cent.
While the rapidly rising consumer prices are becoming a hot issue in other countries, headline inflation in New Zealand remains relatively subdued.
At 1.5 per cent headline inflation, New Zealand's economy boasts comparatively balanced price stability for the time being, with spare capacity for future growth. That is why the RBNZ is not expected to implement any major changes on Wednesday.
The kiwi is thus likely to continue strengthening against the greenback in the near future.
The Census Bureau in the U.S. is scheduled to publish the latest durable goods orders on Thursday. According to the preliminary forecasts, manufacturing orders are expected to have grown by 0.7 per cent in April.
This would represent only a minor uptick in demand over the previous period when the index expanded marginally by 0.5 per cent.
The subdued performance in March reflected the global trend of digitalising industry, as economic focus moves away from manufacturing and onto the services sector.
Further disappointments on Thursday can therefore exacerbate the current woes for the greenback, which demonstrates weakness against most majors. This weakness is also observed on some crosses.
As can be seen on the daily chart below, the NZDUSD continues to advance within an ascending channel underpinning the latest uptrend. The latter emerged in the wake of the ABC correction, which, in turn, followed the preceding 1-5 Elliott impulse wave pattern.
The pair is currently consolidating above the 50-day MA (in green), 100-day MA (in blue), and the lower end of the channel. Once there is enough bullish commitment in the market, the NZDUSD is likely to probe breaking above the 23.6 per cent Fibonacci retracement level before heading further north.
At present, the Stochastic RSI indicator underscores the available bullish commitment, which is not at its maximum just yet.
Monday - BOE Governor Bailey Speaks; NZD q/q Retail Sales; BOJ Governor Kuroda Speaks.
Tuesday - German ifo Business Climate; U.S. CB Consumer Confidence.