Tame CPI Still Spells Trouble for Fed’s Favored Inflation Gauge

A key measure of US inflation was tame at the start of the year. But another metric is shaping up to paint a very different picture.

Wednesday’s report on the consumer price index showed core inflation, which excludes food and energy costs, was mild in both January and February — a pleasant surprise as companies tend to raise prices at the turn of the year. Yet economists expect another gauge, one preferred by the Federal Reserve and set for release on Friday, was probably rather strong in both months.