US consumer prices surged in January by more than expected, sending the annual inflation rate to a fresh four-decade high and adding more urgency to the Federal Reserve’s plans to start raising interest rates, Report informs referring to Bloomberg.
The consumer price index climbed 7.5% from a year earlier following a 7% annual gain in December, according to Labor Department data released on February 10. The widely followed inflation gauge rose 0.6% in January from a month earlier, reflecting broad increases that included higher food, electricity and housing costs.
Excluding the volatile food and energy components, so-called core prices increased 6% from a year ago, also the most since 1982, and 0.6% from a month earlier.
For President Joe Biden, the decades-high inflation presents a risk to his party’s razor-thin congressional margins ahead of the midterm elections later this year.
With many pointing to the White House’s stimulus bill last year as a key driver of the price increases, Biden’s approval ratings have taken a hit as Americans face higher prices at the gas pump and the grocery store.
Food prices rose 0.9% in January, the most in three months, and energy costs also advanced 0.9% on gains in fuel oil and electricity. Residential electricity costs increased last month by the most in 16 years. From a year ago, food inflation is up 7%, the most since 1981.