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.

Inflation rises to 2.7% in June, driven by earlier tariffs. Learn how this surge impacts the Fed's strategy and economic outlook.