Inflation in July is expected to be its hottest since the start of the pandemic, suggesting that the sharp rise in consumer prices has reached its peak, economists say.

Economists expect to see an increase in the consumer price index of 0.5% for July, or a gain of 5.3% year-over-year, according to Dow Jones. That compares to a 0.9% jump in June, or 5.4% on a year-over-year basis, the biggest monthly increase since August, 2008

Excluding energy and food, economists expect CPI rose by 0.4% last month, compared to the 0.9% increase in core in June. On a year-over-year basis, June’s core CPI of 4.5% was the highest since September 1991.

“It will be another very hot number with the fingerprints of the pandemic all over it,” said Mark Zandi, chief economist at Moody’s Analytics. Price increases are expected to continue — though at a slower pace — in airline tickets and lodging, areas in which there was pent-up demand when the economy reopened.

If the inflation report is hotter than expected, when it is reported Wednesday at 8:30 a.m. ET, it could be a slight negative for stocks and send bond yields higher. Yields move opposite price.

The report is not expected to have much impact on the Federal Reserve or its plans for tapering the $120 billion a month bond-buying program it’s kept in place to support the economy in the pandemic. The central bank has said inflation is temporary, and the market is looking more at employment data to see if the labor market is as strong as it appeared in the July jobs report Friday.

The really hot CPI numbers are likely to be coming to an end, although the Fed’s preferred inflation measure is the inflation component of the personal consumption expenditure data.

“I think the last of the effects of the reopening will be in this month,” Zandi said, noting July could be the hottest month for inflation.

“I think it’s going to be a peak in the year-over-year, if not July, then it was June,” he said. “We’re there. We’re peaking.”

Zandi said higher used car prices should also be a factor, but the increase is not likely to come near the 10.5% increase in June. Goldman Sachs economists expect used cars to give CPI a boost even though industry reports show some price declines.

“We have 0.6 for the headline, 0.47% for core,” said Goldman Sachs chief economist Jan Hatzius. “It’s on the high side relative to the consensus and mainly because we’re probably going to get another sizeable increase in used cars even though auction prices are now falling.”

Even though the surge in CPI has likely topped out, the year-over-year comparisons should continue to look elevated because of base effects.

“I think it slows sequentially. Year-over-year I think it’s going to stay high, until we cycle through these big sequential increases in the spring of next year,” Hatzius said. “Sequentially, I think we’ll see a sharp slowdown post the August report.”

But even if the pace of inflation slows, the debate over whether it is temporary will not end. Fed Chairman Jerome Powell has said the elevated inflation should slow as supply chain issues are resolved.

Economists are eyeing rent prices, which have increased and are likely to continue rising next year.

“A lot of things that were temporary and artificially boosted because of the reopening and rising demand, those will slow,” said Kevin Cummins, chief U.S. economist at NatWest Markets. “The rental costs are going to offset that moderating.”

Cummins said rent was up 2.3% last year, and should be up 2.4% next year. But by 2022, the increases will pick up even more, and rent in CPI could be up 3.2%.

Zandi said rent was up more than 8% year over year in June, and should tick up by 0.2% or 0.3% for the month in July. Rent, together with owners equivalent rent is about a third of CPI, he noted.

“It takes awhile for things that are taking place in the rental market to show up,” Zandi said. “By early next year, we’re going to get some very strong rent increases. That’s persistent and sticky and one reason to be nervous about inflation being higher for longer.”

Cummins said he expects core CPI to be at 2.6% by the end of next year, compared to 2.1% in the Fed’s forecast. He noted one difference is likely his calculation for higher rental prices. He expects core CPI to be at 4.2% at the end of this year.

Zandi said one area for slower paced increases is medical care.

“In the [personal consumption expenditure data], medical costs are much more important and housing is less important,” he said. “Inflation measured by the CPI is going to be a lot hotter than inflation, measured by the PCE.”

That in itself could become part of the debate.