As noted earlier, headline CPI prices surged by 1.3% (1.32% unrounded) M/M in May - the highest monthly increase since the early 1980s - driven by soaring energy and service prices, smashing consensus expectations of a 1.1% increase.

Energy prices spiked 7.5% mom as gasoline prices reached record levels in mid-June. Food prices increases 1.0%.

Meanwhile, yoy headline CPI inflation made a new 40-year high of 9.1%.

As Bloomberg notes, the red-hot inflation figures reaffirm that price pressures are rampant and widespread throughout the economy and continue to sap purchasing power and confidence. That will keep Fed officials on an aggressive policy course to rein in demand, and adds pressure to President Joe Biden and congressional Democrats whose support has cratered ahead of midterm elections.

More importantly from the Fed's perspective, the core CPI also beat expectations, rising 0.7% (0.71% unrounded) mom versus consensus at 0.6%. The yoy rate dropped from 6.0% to 5.9%, because of base effects.

The strength in core inflation was broad-based:

Core commodities rose 0.8% as new and used car prices took another leg up, rising by 0.7% and 1.6% respectively.

Apparel, medical care commodities and other goods saw increases of 0.8%, 0.4% and 0.5%, respectively.