Inflation hits new 40-year high, surging 7.9%

Inflation around the U.S. reached a new 40-year high in February, with consumer prices jumping 7.9% from a year ago — the fastest annual rate since the Reagan administration.

Rising costs of energy, housing and food drove the increase, the Labor Department said on Thursday. The price of energy has surged 26% over the last year, sharply increasing the cost of gasoline, fuel oil and natural gas for home heating. Groceries were up 8.6% from a year ago, while clothing rose 6.6%.

Excluding volatile food and energy, consumer prices rose 6.4% year-over-year, the Labor Department said.