Wholesale inflation in the US ran at just half the expected monthly rate in March, the BLS said Tuesday.

Headed into the release, economists forecast a 1.1% month-to-month increase on the headline PPI gauge. The actual readout was just 0.5%.

The culprit for the jump was an outsized 1.6% gain on the goods side, the largest since August of 2023.

That was, of course, attributable to the energy gauge, which rose 8.5%.

Drilling down further (no oil pun intended), a near 16% increase on the gasoline index was responsible for half of the jump on the headline goods measure.

Other than that rather unfortunate outcome, Tuesday’s PPI release appeared benign on a quick read. Core PPI rose just 0.1% MoM, below every estimate and just a third of the prior month’s gain.

Core goods showed a pedestrian 0.2% monthly gain, the slowest since November, and the food gauge posted a decline, the third in four months. On the services side, the main index was unchanged in March from February.

Although the YoY increases on both the overall PPI gauge and the core index are elevated at 4% and 3.6%, respectively, this release could’ve been far worse. And it’ll probably get worse if the energy shock doesn’t abate in a hurry.

But, again, things are apparently under control for the time being. Tuesday’s cooler-than-expected read on wholesale inflation came on the heels of a CPI report which, with allowances for the expected jump in energy costs, was likewise better-than-feared.