Apparently the acceptable words are Amerindians, indiginous peoples… or such.
Inuit is generally considered to be the appropriate name. Covers the indigenous people of the Arctic and sub-Arctic of North America and Greenland.
There’s also the Alutes and in Europe the Saami. They’re the indigenous peoples of that region as distinct from First Nations of North America and Canada.
https://arcticmatters.blogspot.com/2010/10/indigenous-peoples-sami-inuit-in-north.html
It would appear to be considered derogatory because someone made a mistake.
No mistake, the term is derogatory and perjorative irrespective of how it’s pronounced in Algonquin.