WASHINGTON (AP) — U.S. wholesale prices dropped unexpectedly in April for the first time in more than a year despite President Donald Trump’s sweeping taxes on imports.

The producer price index — which tracks inflation before it hits consumers — fell 0.5% last month from March and rose 2.4% from April 2024, the U.S. Labor Department reported Thursday.

Excluding volatile food and energy prices, so-called core wholesale prices dipped 0.4% from March and rose 3.1% from a year earlier.

Economists had expected that producer prices rose modestly in April. A 0.7% drop in services prices brought the index down.

On Tuesday, the Labor Department reported that consumer prices rose just 2.3% last month from April 2024 — smallest year-over-year gain in more than four years.

Economists have predicted that Trump’s tariffs would drive up prices, and many expect the impact to show up in June or July.

Still, Trump’s tariffs are ever-changing, so it’s hard to forecast their economic impact. On Monday, for instance, Trump unexpectedly agreed to a massive de-escalation of his trade war with China — third-biggest source of U.S. imports — by scaling back his taxes on Chinese products to 30% from 145%; China slashed its retaliatory tariffs on U.S. products from 125% to 10%.