Overall, consumer prices rose 7.9% on a yearly basis in February, which is the highest 12-month increase since January 1982, according to data released Thursday by the Bureau of Labor Statistics (BLS). On a monthly basis, prices ticked up 0.8% between January and February.
All that price growth comes thanks to a perfect storm of economic factors: a huge surge in consumer demand for goods over the last year combined with major snags in the global supply chain that caused shortages and shipping delays, which mean higher costs for businesses. Businesses pass those costs on to consumers in the form of higher prices.
Even scarier: February’s data doesn’t fully account for the medium- and longer-term effects of the Russian invasion of Ukraine, a conflict that is likely to push inflation rates even higher thanks to huge disruptions in the global energy market (Russia is a major producer of crude oil). It’s a fair bet that prices will rise further in the coming weeks and months — especially when it comes to gasoline.
Soaring prices for gas and cars
Energy prices rose 25.6% on a yearly basis in February and 3.5% on a monthly basis, according to the BLS. That means more shockingly high heating bills, as well as higher costs to fill up at gas stations. The report notes that gasoline prices, which have now risen an eye-watering 38% in a year, were one of the largest contributors to the overall bump in the inflation rate last month.
Between January and February alone, gas prices jumped 6.6%. Consumers are undoubtedly feeling the pain at the pump: average gas prices hit an all-time high earlier this week and have kept rising, reaching $4.32 per gallon as of Thursday according to AAA, compared to $2.82 a year ago. Many cities are now seeing average gas prices well above $5 per gallon.
If you’re in the market for a new car, the market is not on your side. Prices for new cars are now up 12.4% over the course of a year as of February, the BLS said, while used car prices have soared 41.2%. In the wild competition to find new wheels, the vast majority of new car buyers are paying over stick price lately.
Cities with highest inflation levels
Where is inflation worst in the U.S.? While a national inflation rate nearing 8% is extremely high, some cities are seeing even faster price growth.
In Atlanta, consumer prices are up 10.6% on a yearly basis. In Phoenix, prices are up an astounding 10.9%. In Miami, prices are up 9.8%.
The Northeast had the lowest rate of inflation last month at 6.6%, with prices in the New York metro area growing at just 5.1% — almost three percentage points lower than the national rate.
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