As the clock ticks down toward Tuesday's proposed tariffs on Canada and Mexico, inflation traders prepared for a short-term shock to the annual headline rate from the consumer-price index over the second half of this year.

In the past year, chicken prices have risen as much as 43% while egg prices have increased 27%, according to Mexico's National Union of Poultry Farmers.

St. Louis Fed president Alberto Musalem said Monday that he is closely watching longer-term inflation expectations and downside risks to growth as he argues for maintaining a 'patient approach' to monetary policy.