The Fed, which lifted its benchmark overnight interest rate in December for the first time in nearly a decade, meets on Wednesday.
Policymakers are expected to hold interest rates steady when they meet this week, but may tweak their description of the economic outlook to reflect more benign conditions, leaving the path open for future rate rises.
A Reuters poll showed on Friday showed that economists expect the Fed to stand pat and then deliver a rate hike in June, and follow up with another by the end of this year.
Investors also locked in gains after the index soared to an 11-1/2 week high following a report the Bank of Japan will consider another easing step at its two-day policy review that ends on Wednesday.
Bloomberg reported on Friday that the BOJ is considering applying negative rates to its lending program for financial institutions.
But some investors still believe the central bank might opt to hold steady as it assesses the impact of its negative interest rate policy unveiled on Jan. 29. A semi-annual report on the country's banking system issued on Friday by the central bank said the policy has caused some disruption in fund flows and will hurt financial institutions' profits for the time being.
Financial institutions are facing increasing credit risks, China central bank vice governor Chen Yulu said on Sunday, according to a report published by the official Shanghai Securities News.
Factors that influence financial market stability also are on the rise, especially as China experiences continued economic downward pressure, the newspaper cited Chen as saying.
He also said the People's Bank of China is seeking to improve monetary policy framework and close regulatory loopholes, according to the report.
Oil prices fell early on Monday as traders took profits after three weeks of gains and as a jump in the dollar late last week was priced into fuel markets.
Front-month Brent crude futures were trading at $44.66 per barrel at 0043 GMT, down 45 cents, or 1 percent, from their last settlement.
U.S. West Texas Intermediate (WTI) futures were down around half a dollar, or 1.2 percent, at $43.22 a barrel.
Monday's early oil price drops came despite another decline in the U.S. rig-count that brings activity down for a fifth straight week and to levels last seen in November 2009.
A total of 343 rigs were drilling for new oil last week. That compares to over 700 this time last year, according to oil services company Baker Hughes Inc on Friday.
Energy firms have sharply reduced oil and gas drilling since the collapse in crude markets began in mid-2014, bringing down prices by as much as 70 percent to 13-year lows earlier this year. (Editing by Richard Pullin).
Reference: Reuters
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