The hits just keep on coming for the economy and exchange traded funds (ETFs). The Labor Department announced this morning that the rate of inflation was up by its largest amount in 17 years in 2007.

Martin Crutsinger for the Associated Press says that consumer prices jumped by 4.1%, compared with a 2.6% increase in 2006. Pumping gas and shopping for groceries became the most painful that it’s been in years, as energy and food prices jumped by the largest amount since 1990.

Meanwhile, the Federal Reserve added to the bad news in a report that said output at the nation’s factories, mines and utilities showed no growth in December.

The Fed is keeping a close watch on things to see if the price jumps push core inflation higher. Meanwhile, many are looking forward to their meeting at the end of this month, when it’s expected that they’ll cut interest rates by a half point.

Tags: Energy, Federal Reserve, Financial, Metals & Mining, Retail, Utilities