The Producer Price Index (PPI), which measures inflation on the wholesale level, decreased by 0.1% in February, coming in cooler than the 0.3% gain expected. January’s reading was also revised lower. On a year-over-year basis, PPI decreased from a downwardly revised 5.7% to 4.6%. Core PPI, which strips out volatile food and energy prices, was flat last month and much lower than the expected 0.4% gain. On an annual basis, Core PPI declined from 5.4% to 4.4%.

What’s the bottom line? Annual wholesale inflation readings are also moving lower in the right direction, and the progress made on the producer side of inflation is notable. At its peak last March, PPI was at 11.6% year over year and is now well less than half that amount at 4.6%.