Investors are circling July 29 on their calendars. It's the date of the next Fed meeting, and the outcome is looking like anyone's guess. Traders see a nearly 50% chance of a rate hike, a sharp increase from Monday when the odds were less than 40%. With the interim peace deal between the US and Iran in tatters, oil prices are spiking and inflation is firmly back in the picture.

Fed Governor Christopher Waller said on Monday that policymakers may need to raise rates if underlying inflation continues to signal broad price pressures. His comments have reinforced the hawkish shift in market pricing.

About that inflation data: In a report today, the Consumer Price Index is expected to slow to 3.8% in the year through June, from 4.2% in May, according to a Bloomberg survey. Producer prices are out tomorrow, providing additional clues on the inflation trajectory.