Wholesale inflation drop hopeful indicator for consumers, companies 

Inflation’s grip on businesses loosened greatly in March, improving the outlook for companies and consumers moving forward in 2023, according to an article from the Associated Press. 

The U.S. government said plunging energy prices pulled the producer price index down 0.5% in March from February. It marks the biggest decrease in producer prices in three years and follows other reports showing easing inflation on broader consumer prices. Measured year over year, consumer prices are currently up 5%, down from a peak of 9.1% in 2022. 

Lower prices paid by businesses on raw materials and other items indicate they are less likely to raise prices in the months ahead. Even when excluding the impact from volatile food and energy costs, the index still registered a drop in so-called core wholesale inflation by 0.1%. 

Inflation may be cooling, but so is the broader economy as the Federal Reserve has raised interest rates to stifle consumer demand and tame inflation; some analysts still predict a recession in 2023. 

The latest economic data has many on Wall Street expecting the Fed will soon pause its efforts to slow economic growth and then cut rates twice by the end of the year. The Fed itself has forecast that it will implement one more quarter-point hike at its May meeting and then keep rates unchanged for the rest of the year.