• Traders are betting the Federal Reserve could raise its target fed funds rate by 1 percentage point at its July 26-27 meeting.
  • After June's super hot consumer price index, market expectations began to climb and they went even higher after the Bank of Canada raised its rate by 1 point.
  • Investors on Thursday will look to comments from Fed Governor Christopher Waller and to June's producer price report for more clues on what the Fed might do.

After June's super hot consumer inflation report, traders in the futures market immediately began to bet the Federal Reserve could raise interest rates by as much as a full percentage point later this month.

The consumer price index, reported Wednesday morning, rose 9.1% year over year, the hottest monthly reading for the number since November 1981. The report immediately spurred market talk that the Fed could become more aggressive, and that its tougher actions would have an even bigger chance of causing a recession.