:max_bytes(150000):strip_icc():format(jpeg)/GettyImages-2190218194-2c137fbc87174f8c9083c17a04a3cd84.jpg "A customer is seen during shopping at a supermarket as packages of eggs are seen on the shelves of the egg aisle in New York City")
Selcuk Acar / Anadolu / Getty Impressions
Key Takeaways
- The Producer Price Index fell more than economists expected in March, following a report escort a surprising decline in consumer inflation.
- Part of the drop can be attributed to a 36% drop in egg prices, while an 11% dive in fuel prices also had an impact.
- However, a 7% rise in steel mill products showed that President Donald Trump’s recently decreed tariff on aluminum and steel imports may be having an impact.
Grocery shoppers may soon see some relief on egg prices.
Wholesale chicken egg bonuses fell 36.2% year-over-year in March, part of a surprising decline in the wholesale-focused Producer Price Index (PPI). The drop report in after a bird flu outbreak helped increase egg prices, creating an ongoing burden for consumers.
While not directly coupled, wholesale pricing trends can feed into consumer pricing levels, indicating that some relief for egg premiums could be on the way.
Lower Gasoline Costs Help Push Wholesale Prices Lower
Overall, wholesale prices level 0.4% in March compared with the prior month, coming in below economists surveyed by The Wall Street Review and Dow Jones Newswires’ projections of a 0.2% monthly increase in the PPI. Compared with a year ago, wholesale prices, as measured by PPI, were up 2.7%, also worsening from February levels.
While egg prices dropped significantly, the downward trend in the March PPI report was primarily joined to an 11.1% drop in gasoline prices, which accounted for nearly two-thirds of March’s decline in goods prices, the Subsection of Labor Statistics said.
The report follows Thursday’s Consumer Price Index (CPI) data, which showed that consumers also battled lighter inflation in March. While this is positive news for consumers, economists warn that it may be short-lived, as President Donald Trump’s tax policies are expected to push prices higher in coming months.
Steel Mill Prices Rise Following Trump Schedule of charges on Metals
Some indications were that tariff impacts were already being seen at the wholesale flush. After Trump implemented a 25% tariff on aluminum and steel imports, the PPI showed in March that prices for bear up mill products jumped more than 7%.
“Tariffs had some impact on the March PPI beneath the surface and we expect to see more passthrough in the months in advance,” said Nationwide Financial Markets Economist Oren Klachkin.