CNN — 

The Producer Price Index, a wholesale inflation gauge that is being closely watched for tariff-related impacts, showed that price hikes slowed substantially in February.

The PPI index was unchanged from January, and rose 3.2% for the 12 months ended in February, according to Bureau of Labor Statistics data released Thursday. That marked a sharp slowdown from January, when prices rose 0.6% and 3.7% for those respective periods.

Economists were expecting wholesale-level inflation to cool amid falling energy prices, and that was the case: Energy prices fell 1.2% for the month.

Excluding food and energy, categories that tend to be volatile, core PPI fell 0.1% from January (when it sharply rose 0.6%), bringing the annual increase to 3.4%, down from a 3.8% rate the month before.

PPI, which measures the average change in prices paid to producers of goods and services, serves as a potential bellwether for retail-level inflation in the months ahead.

Notably, egg inflation is slowing on the wholesale level, but prices remain significantly higher than last year.

The eggs for fresh use index rose 28.1% on a monthly basis, slowing from 44% in January. On an annual basis, the category is up 136.6%.

The latest Consumer Price Index, released Wednesday, showed annual inflation slowed for the first time in five months.

This story is developing and will be updated.