If you were looking for more good news — however fleeting it might prove — on the US inflation front at a time when tariffs threaten to impede the Fed’s efforts to restore price stability, look no further than Thursday’s PPI release.

On the headline, wholesale prices fell 0.5% in April from March, the BLS said. That was a rather dramatic miss to consensus, which expected a 0.2% increase. In this context, “miss” is a good thing. March’s headline was revised to show no gain versus a 0.4% decline as initially reported.

The real shock came on the ex-food and energy readout, which printed a 0.4% drop. That likewise counted as a big downside surprise versus consensus, and the unrounded print (-0.44267%) was the most pronounced MoM decline in the (relatively short) history of the series.

The services measure notched a 0.7% monthly drop. As the figure shows, that too was a record decline.

This was a margins story. The 1.6% decline on the release’s trade services gauge was the second-largest monthly drop ever, and it was responsible for some two-thirds of the overall decrease registered by the services measure shown above. More specifically, nearly half of that overall decline was attributable to a 6% drop in machinery and vehicle wholesaling margins.

Needless to say, market participants are keen for clues on whether, and to what extent, management’s prepared to eat the cost of Trump’s trade war as lost margin versus passing it along to consumers in the form of higher prices.

Excluding food, energy and trade, PPI fell just 0.1% in April. (Although that doesn’t sound noteworthy, it was the first MoM drop in half a decade.)

With the caveat that I don’t trouble myself mapping the PPI series onto PCE prices, I gotta believe this release biases Wall Street’s core PCE forecasts lower for April, and maybe even a lot lower. If that’s accurate, and those projections are borne out on May 30, that’d mean April’s CPI/PCE readouts both tipped a very subdued inflation impulse.

I’ll add a boilerplate caveat about pervasive uncertainty, a nod to the distinct possibility that Thursday’s PPI release will be seen in hindsight as an anomaly and a cautionary word on the read-across for corporate profits. Consider my bases covered.

Oh, and one more thing: The egg index fell almost 40%, which should get Donald Trump excited. With the exception of deporting undesirables and getting himself on Mount Rushmore, Trump’s biggest domestic priority was ending “the Biden egg crisis.” Congratulations, sir. The McMuffins are safe.