Core CPI gained at its highest annual pace in 40 years, rising | DOJI CAPITAL

Core CPI gained at its highest annual pace in 40 years, rising 0.6% for the month and 6.6% for the year.

"This is largely supply driven inflation unlike the 1970s which was demand driven inflation. (The Fed) just have to let it run its course," Hayes added.

The CPI reading led investors to price in a big rate hike by the Fed, with the market now seeing a 95% chance of a 75-basis-point hike, compared with an 80% chance seen prior to the inflation data. This would mark the central bank's fourth straight hike by that amount. Fed funds futures are also now pricing in 75 bps in December, up from 50. Terminal rate expectations rose to 4.85% in March.