Inflation reached a new 40-year peak in February, according to the Federal Reserve’s preferred gauge, buoyed in part by a surge in oil prices related to Russia’s invasion of Ukraine combined with other supply problems and strong U.S. consumer demand.

       The Commerce Department said Thursday that its personal-consumption-expenditures price index climbed 6.4% in February from a year ago, faster than the 6% increase in the year ending in January. The February rise was the fastest since 1982.

       The so-called core PCE price index, which excludes volatile food and energy costs, rose 5.4% in February from a year before, compared with the 5.2% increase in the year through January. That marks the sharpest 12-month rise since 1983.

       On a monthly basis, core prices climbed a seasonally adjusted 0.4% in February from the prior month, compared with 0.5% in January. That slight moderation hints that inflation measured by the core PCE price index may have peaked.

       Fed Chairman Jerome Powell said on March 16 that the central bank is watching one-month changes in inflation closely to strip away distortions caused by high inflation in the spring of 2021.

       The latest inflation readings add to pressure on Fed officials to keep raising interest rates this year to lower price pressures. The central bank raised its benchmark rate in March for the first time since 2018 and penciled in six more increases by year’s end, the most aggressive pace in more than 15 years.

       Energy prices surged by 25.7% in February from a year earlier, down slightly from the pace of the previous three months, the Commerce Department said, fueled in part by a surge in oil prices following Russia’s invasion of Ukraine in February. The most-widely held futures for Brent crude, which call for delivery of oil in May, breached $100 a barrel for the first time since 2014 after the Ukraine crisis threatened to scramble the region’s exports. Economists think the conflict added more pressure on inflation in March, after crude-oil prices hit their highest points since 2008 and U.S. gasoline prices climbed to record-breaking levels.

       Mr. Powell said on March 21 that the inflation outlook had worsened significantly—even before Russia’s invasion of Ukraine. The effects of the war and sanctions imposed by the West on Russia’s economy could exacerbate supply-chain disruptions while driving up prices of key commodities.

       Fed officials lifted their benchmark rate in March by a quarter percentage point to a range between 0.25% and 0.5% from near zero. They signaled they expect to lift the rate to nearly 2% by the end of this year. Most of them projected core PCE inflation would end the year at 4.1%.

       Thursday’s data follow four-decade-high inflation readings from the Labor Department. In February, the consumer-price index leapt 7.9% from a year earlier, with core CPI up 6.4%. Producer prices rose 10% on a 12-month basis in February, though the pace of gains slowed slightly in February from January.

       The Labor Department’s CPI usually runs hotter than Commerce’s PCE index due to differences in the pools of spending measured. The CPI captures changes in living costs based on what city-dwellers spend out of pocket for a hypothetical basket of goods and services. The PCE index, by contrast, includes prices paid by organizations on behalf of consumers—for example, employer-sponsored healthcare plans—as well as prices in rural areas.

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