The CME Group’s FedWatch Tool places the chance of a .25 rate cut in September at 86.4%. If this week’s July CPI report comes above the June pace of 2.72% year over year, the cost of essentials like groceries, gas, and rent will remain stubbornly high.

A jump in wholesale prices is likely to bolster concerns among Federal Reserve policymakers that rising inflation remains a risk, intensifying debate over the rationale for an interest rate cut next month and leaving the tension between the U.

Market participants on Tuesday upped their expectations for interest rate cuts by the Federal Reserve this year after the release of the July consumer price index (CPI) report. The U.S. Bureau of Labor Statistics said core CPI accelerated 3.