U.S. Treasury yields retreated on Wednesday after monthly consumer inflation data came in softer than anticipated.

The rate on the 10-year note fell about 10 basis points to 4.344%. The 2-year Treasury yield was last at 4.726% after sliding by roughly 9 basis points.

Yields and prices move in opposite directions. One basis point equals 0.01%.

The consumer price index rose 0.3% from March to April, slightly below the 0.4% consensus forecast of economists polled by Dow Jones. The measure of a basket of goods and services on an annualized basis increased by 3.4%, in line with expectations.

That monthly decline can offer some good news for market participants hoping the Federal Reserve has seen enough impact from its rate hiking campaign to begin lowering the borrowing cost sooner rather than later. The market is now "keenly watching" to see if expectations for an earlier cut to rates are growing, according to Quincy Krosby, chief global strategist at LPL Financial.

"The Fed will certainly need a series of cooler reports for adjusting its rate easing timetable, but the CPI report suggests that the path towards 2% is a bit less bumpy," Krosby said.

Core CPI, which strips out food and energy prices, added 0.3% from the previous month and 3.6% from a year earlier. Both were in line with forecasts.

The data comes a day after the producer price index for April, which tracks wholesale prices, came in higher than expected on Tuesday. It rose 0.5% from the previous month, the Labor Department's Bureau of Labor Statistics reported, higher than the 0.3% increase estimated by economists surveyed by Dow Jones.

Following the PPI release, Federal Reserve Chair Jerome Powell on Tuesday suggested the central bank would need to be patient as inflation has remained at a higher level than anticipated for longer.