The bureau of Labor Statistics issued the Consumer Price Index on Wednesday, and it showed inflation soared 9.1% year over year, well exceeding the Dow Jones estimate of 8.8%. It was the fastest pace of inflation seen since November of 1981.

Core CPI, excluding food and energy, was up 5.9%, beating the estimates of 5.7%. Core inflation had peaked in March at 6.5%, and has gradually been inching down.

Headline CPI rose 1.3% on a monthly basis, with Core CPI rising 0.7%. The estimates had been 1.1% and 0.5%.

The numbers overall, and the spread across a wide variety of categories, would seem to indicate that unlike previous market assumptions, inflation is not yet peaking.

Robert Frick, corporate economist at Navy Federal Credit Union said, “CPI delivered another shock, and as painful as June’s higher number is, equally as bad is the broadening sources of inflation. Though CPI’s spike is led by energy and food prices, which are largely global problems, prices continue to mount for domestic goods and services, from shelter to autos to apparel.”

The numbers have increased fears the Fed will increase the aggression with which it will raise rates in the coming meetings, and that has increased worry over the effects that will have on an already slowing economy.

Traders now have placed bets showing a better then even chance the Fed will raise rates by a full 100 basis points in the next meeting, according to the CME Group’s FedWatch tool as of 10:40 a.m. ET.

James Knightley, ING’s chief international economist said, “U.S. inflation is above 9%, but it is the breadth of the price pressures that is really concerning for the Federal Reserve. With supply conditions showing little sign of improvement the onus is the on the Fed to hit the brakes via higher rates to allow demand to better match supply conditions. The recession threat is rising.”

The report showed energy prices rising 7.5% month by month, and 41.6% year over year. The food index was up 1% while shelter, a third of the CPI, was up 0.6% on the month, and 5.6% for the year. It was the sixth month in a row that food at home jumped at least 1%.

Rental costs were up 0.8% for the month, the biggest monthly jump since April of 1986.

Stocks sunk and bond yields surged after the release.

Much of the inflation again came down to energy costs, as gasoline rose 11.2% for the month, and just below 60% for the year. Electricity was up 1.7% for the month and 13.7% on the year. New and used vehicles were up at 0.7% and 1.6% respectively.

Medical care was up 0.7% over the month, with  1.9% increase in dental services, the largest monthly rise for that sector going back to 1995.

Airline fares were one of the few declines, dropping 1.8% for the month, though still up 34.1% for the year. Meat poultry, fish, and eggs, also dropped 0.4% over the month, though it is still up 11.7% for the year.

The hit to workers was real, as inflation-adjusted incomes based on average hourly earnings fell 1% for the month, and 3.6% for the year, according to a separate BLS release.

The Fed is expected to continue interest rate hikes until it brings inflation closer in line with its 2% target. It has indicated the rate hikes will not slow until it sees “clear and convincing evidence that inflation is coming down.

In light of this print, it would appear such evidence is still lacking, hence the investor expectations now increasing for a full 1% hike of the 1.5% Fed funds rate at the next FOMC meeting July 26-27.

There is some reason to hope this is close to a peak however, and inflation will now begin to cool. Gasoline prices have been trending steadily downward from their June peak, with the average price for a gallon of regular gasoline presently at $4.64, which is a 4.7% drop for the month, according to Energy Information Administration data.

Meanwhile, the S&P GSCI commodities index, which measures prices for a broad range of goods, is down 7.3% in July, even though it is still up 17.2% for the year. Wheat futures have declined 8%, just since July 1, while soybeans have dropped 6%, and corn is down 6.6% over the same period.

Meanwhile in trucking, Brian Antonellis, senior vice president of fleet operations for Fleet Advantage, says, “For probably 10 to 15 years before the pandemic, the industry fell into a stable routine where costs up across the board somewhere between 1 to 3 percent a year. It was easy to budget, it was easy to forecast, it was easy to build into rates. The challenge we face today is it’s not that 1-3 percent anymore, it’s 10 to 20 percent depending on what cost bucket you’re talking about… I do think people honestly are not trying to overcharge the customer. They’re not being predatory about it. But they are trying to find that fine line. What do we pass forward? How do we look at the costs coming in?”

Antonellis went on, “There are going to be challenges. I don’t think it’s all negative. I do think there will be challenges for the next six months. But I do think we’re on an upswing,” adding, “I see a light at the end of the tunnel.”