It's not necessarily related to core inflation, but I think price gouging has something to do with it. Oil companies could bring down the price but increasing production, but they are enjoying record profits.
I have a way esoteric take on inflation. Housing supply - especially in high income areas like New York and California. The Bay Area has been especially awful with respect to not building up enough housing in places where people make a lot of money.
So the price of housing - purchase and rent - goes up. In order to keep workers down the scale from leaving, companies have to charge more money. I had a momentary lapse of judgement today and got a #2 breakfast meal at McDonalds. It was like $8.67. I just assumed these meals were in the $5 range. Well, when the cashier is making $18/hour, you have to charge more.
OK, but this isn't an issue in say, Champaign, right? Except CA has two major exports.
1) People with not much money for California, but a lot of money for other places
2) Money
Someone moves to Boulder, buys a house with their filthy CA lucre, raises housing prices in Boulder, Boulder McDonalds has to raise their prices. Or someone from Palo Alto decides to diversify their real estate portfolio and buys a house in say, Lake Tahoe, taking a house off the market, same effect.
Even outside housing specifically, it's really hard for the Federal Government to do any sort of working policy when we practically have multiple currencies because the cost of living in various parts of the US have gotten so extremely disparate. Bernie says we need a $15 minimum wage which would give almost nobody in the Bay Area a raise, but would double wages for large parts of the US. A dollar is still a dollar, but an hour of labor is worth 2x in CA than in MS, and that money can be spent anywhere equally. And a large part of why CA has gotten so wacky is a dearth of new housing.
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