This week's big calendar event is the Federal Reserve's Open Market Committee (FOMC) meeting, which concludes on Wednesday with expectations favouring a quarter-point rate increase.
Indeed, Treasury yields indicate that markets have priced in a rise in the Fed funds rate from 0.75-1% to 1-1.25% as the rate-sensitive two-year Treasury yield holds around the 1.3% level.
Inflation pressures are weakening, however, and surveys of purchasing managers indicate growth in business activity is beginning to slow – albeit from robust levels.
This clouds the view of future Fed operations. A further rate increase this year cannot be forecast with any certainty, and the Fed will be closely watched on Wednesday for any announcement on balance sheet reductions.
Andreas Johnson, economist at SEB, says: "For now we maintain our forecast that the June hike will be followed by a hike in September."
"Uncertainty has increased, however. Unless inflation starts to accelerate or wage growth takes off sharply in the US, we will push back our expectations."
UK interest rates
There's not much chance of the Bank of England raising its main rate on Thursday given the added economic uncertainties presented by last week's UK election result.
A hung parliament resulting in a rather weak looking coalition between the Conservatives and Democratic Unionists from Northern Ireland has not filled the markets with confidence.
The pound is nearly 2% weaker than before the election, while bond yields are falling as investors seek safe positions in the Gilt market.
Inflation is routinely outpacing wage growth, creating a squeeze on household spending that prevents the BoE from making a move on interest rates.
"It is highly unlikely that the Bank of England changes interest rates in the foreseeable future and that is priced in to money market rates," says Chris Iggo, chief investment officer fixed income at Axa Investment Managers.
UK unemployment and earnings
All the data the Bank wants to see improving before it can pull the rate trigger are published this week.
On Wednesday, the Office for National Statistics releases the unemployment rate for April. In March the rate fell to a four decade low of 4.6% and it is forecast to remain at this level for April.
Last week the Organisation for Economic Co-operation and Development warned of rising unemployment in the coming years as lingering Brexit negotiations hamper growth and stifle wage appreciation.
At the same time, the ONS publishes average earnings data. Average annual earnings rose 2.1% in March and 2.2% annual growth is expected in April's numbers.
This still represents a deficit of 2 percentage points from April's consumer price inflation rate of 2.4%, however.
The best of the rest
US retail sales data are published on Wednesday. Excluding motor sales, a rise of 0.2% is expected in May following a 0.3% gain in April.
Also on Wednesday, annual consumer inflation in the US is forecast to dip to 2.1% in May from 2.2% in April.
Two measures of US business activity in two of North America's industrial heartlands are published on Thursday.
The Empire State manufacturing survey, published by the New York Federal Reserve, dropped into negative territory last month. The June reading is expected to show some recovery. Further improvement in the Philadelphia Fed survey is also expected.