A key inflation gauge monitored by the Federal Reserve remained elevated in February, showing a 0.4% increase from January and a 2.8% rise year-over-year, indicating persistent cost pressures before the recent spike in gas prices due to the Iran war. Core inflation, excluding food and energy, also rose 0.4% monthly and was 3% higher annually, a pace that, if sustained, would exceed the Fed's 2% target. This data, released on April 9, 2026, and delayed by a government shutdown, serves as a precursor to the more significant March consumer price index report, which is expected to reflect a substantial increase in inflation due to the conflict. The persistent inflation is likely to deter the Federal Reserve from cutting interest rates soon.