Markets will receive the April U.S. retail sales report. Core sales excluding autos are expected to rise 0.2% following March's rise of 0.1%. The headline index is forecasted to fall 0.2% following last month's rise of 0.2%.

George Adell, fixed income strategist from Commerce Capital Markets, said looking at U.S. economic growth, U.S. consumption has held up fairly well but markets are now starting to see a deceleration in spending. Moving forward, higher inflation will take its toll on U.S. shoppers, he added.

He said March's retail sales numbers were weaker than expected, which does not bode well for April's report. Looking at the recent data, he is expecting core retail sales excluding gasoline, building materials and autos to add about 1% to overall GDP.

"We are starting to see a deceleration on the part of the consumer. And part of that is the overall scheme of things. You keep hearing recession in the newspapers, gasoline prices are skyrocketing and food prices are up," he said.

"As that type of news hits the headlines, the consumer will stop in his tracks and he will feel less certain about the future. The consumer is uneasy and it will be a function of what we have been hearing in the last couple of months."

Markets will be able to see how well U.S. consumers are holding up with the release of IBD/TIPP economic optimism. The data is forecasted to come in at a reading of 38 for May, down April's level of 39.2.

Furthermore, the April U.S. import price index, which is expected to rise 1.6% following March's 2.8% increase, will be released. The annualized rate is expected to increase 15.0% following March's increase of 14.8%.

The day is also full of Fed speakers, which include: Cleveland Fed Sandra Pianalto speaking with Bank of France Governor Christian Noyer in Paris; Fed Chairman Ben Bernanke will speak on liquidity measures at a conference in Sea Island, Georgia; Fed Governor Kevin Warsh will moderate a discussion on the Saranes-Oxley Act; San Fransico Fed President Janet Yellen will talk about the economic outlook at a conference in Vancouver, BC; Kansas City Fed President Thomas Hoenig will also speak on the economic outlook at an event in Oklahoma City; and finally, Dallas Fed President Richard Fisher will speak on the Fed and the economy at an event in Midland, Texas.

All times in EDT

Tuesday:

6:10 US Fed's Pianalto, ECB's Noyer Speak on Monetary Policy in Paris

7:45 US ICSC Weekly Store Sales Prior: +3.6%

8:20 US Fed's Bernanke Speaks on Liquidity Measures at the Atlanta Fed Financial Markets Conference

8:30 US Import Price Index (Monthly) April Exp: +1.6% Prior: +2.8%

8:30 US Import Price Index (Annualized) April Exp: +15.0% Prior: +14.8%

8:30 US Advance Retail Sales April Exp: -0.2% Prior: +0.2%

8:30 US Retail Sales Less Autos April Exp: +0.2% +0.1%

8:55 US Redbook Weekly Retail Sales Prior: +1.4%

9:15 US Fed's Warsh Moderates Discussion on Sarbanes-Oxley Act

10:00 US IBD/TIPP Economic Optimism May Exp: 38 Prior: 39.2

10:00 US Business Inventories March Exp: +0.4% Prior: +0.6%

10:30 CA BOC Treasury Auction

11:00 US Fed's Plosser Moderates Discussion on Fair Disclosure

11:15 CA BOC Conducts Repurchase Operation

13:00 US Treasury to Sell 4-Week Bills

13:00 US Yellen Speaks on U.S. Economic Outlook at Vancouver Conference

13:00 US Fed's Hoenig Speaks in Oklahoma City on Economic Outlook

13:30 US Fed's Fisher Speaks About Fed & Economy in Midland, Texas

17:00 US ABC Consumer Confidence 11-May Prior: -46

By Neils Christensen, This email address is being protected from spam bots, you need Javascript enabled to view it , edited by Nancy Girgis, This email address is being protected from spam bots, you need Javascript enabled to view it