Inflation surges 7% in December, highest rate in 40 years

Inflation rose at the fastest pace in nearly four decades in December, as rapid price gains fueled consumer fears about the economy and sent President Biden's approval rating tumbling.

The consumer price index rose 7% in December from a year ago, according to a new Labor Department report released Wednesday, marking the fastest increase since June 1982, when inflation hit 7.1%. The CPI – which measures a bevy of goods ranging from gasoline and health care to groceries and rents – jumped 0.5% in the one-month period from November.

Economists expected the index to show that prices surged 7% in December from the year-ago period and 0.4% from the previous month. 

So-called core prices, which exclude more volatile measurements of food and energy, soared 5.5% in December from the previous year – a sharp increase from November, when it rose 4.9%. It was the steepest 12-month increase since 1991.

Despite the red-hot reading, stock market futures rose following the data release.