The risk is that a hotter-than-expected June inflation report — one that Fed Chair Jerome Powell recently called among the most important for assessing the impact of tariffs — could slow the pace at which the central bank lowers interest rates. Importantly, that could also throw a wrench into the stock market’s record-setting rally.

Wholesale prices were unchanged in June and showed only a mild effect from U.S. tariffs, adding to the growing view that trade wars won’t lead to a big increase in inflation.

"Food price inflation has increased for the third consecutive month to its highest annual rate since February of last year," he said, although it remains well below the peaks seen two years ago.