February CPI inflation dropped to 2.8%, below expectations of 2.9%.

Core CPI inflation dropped to 3.1%, below expectations of 3.2%.

This marks the first decline in both Headline and Core CPI since July 2024.

February PPI inflation fell to 3.2%, below expectations of 3.3%.

Core PPI inflation fell to 3.4%, below expectations of 3.6%.

CPI and PPI both suggest a higher PCE inflation (Feds main inflation tracker), so bonds ended up selling off and mortgage rates increased mosdestly despite core CPI and PPI coming in lower than expected.

The PCE report will be released on March 28.