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.

Consumer inflation likely accelerated in June, as the Trump administration's tariffs start to push up prices. The Labor Department's consumer-price index for last month is due at 8:30 a.m. ET Tuesday.

Data for June are expected to make it clear that progress in bringing down the inflation rate is over for the foreseeable future as higher tariffs push up prices. While the consumer price indexes for April and May showed limited effects from tariffs,