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WASHINGTON (AP) — U.S. wholesale inflation cooled last month, despite worries that President Donald Trump’s tariffs would push prices higher for goods before they reach consumers.

The Labor Department reported Wednesday that its producer price index — which tracks inflation before it hits consumers — was unchanged last month from May and up 2.3% from a year earlier. Both measures came in below what economists had expected.

Excluding volatile food and energy prices, so called core producer prices were also unchanged from May and up 2.6% from June 2024.

The report on wholesale inflation came a day after the Labor Department reported that consumer prices last month rose 2.7% from June 2024, the biggest year-over-year gain since February, as Trump’s sweeping tariffs pushed up the cost of everything from groceries to appliances.

Wholesale prices can offer an early look at where consumer inflation might be headed. Economists also watch it because some of its components, notably measures of health care and financial services, flow into the Federal Reserve’s preferred inflation gauge — the personal consumption expenditures, or PCE, index.

Inflation began to flare up for the first time in decades in 2021, as the economy roared back with unexpected strength from COVID-19 lockdowns. That prompted the Fed to raise its benchmark interest rate 11 times in 2022 and 2023. The higher borrowing costs helped bring inflation down from the peaks it reached in 2022, and last year the Fed felt comfortable enough with the progress to cut rates three times.

But it has turned cautious this year while it waits to see the inflationary impact of Trump’s trade policies. Trump has aggressively stepped up pressure on the Fed to cut rates, a move that threatens the central bank’s independence.