Nvidia Corp ( NVDA ) shares are in the spotlight Tuesday as the stock moves lower ahead of Wednesday’s inflation data. New reports also suggest another mega-cap tech company is planning to produce AI chips in house. Here’s a look at what’s going on.

What To Know: Nvidia ( NVDA ) shares appear to be facing selling pressure Tuesday following reports that Alphabet Inc ( GOOG ) is developing its own in-house chips to cut costs associated with AI development and reduce its reliance on outside vendors like Nvidia ( NVDA ).

Alphabet’s new in-house chips, called Axion, are expected to be able to handle everything from YouTube ( GOOG ) advertising to big data analysis, and power the company's search engine and AI-related work. The Axion chips are based on circuitry from chip-design firm Arm Holdings.

Alphabet reportedly said the new chips, which are expected to become accessible for external customers later this year, will improve performance by up to 30% compared with the fastest similar chip currently available in the cloud. 

Nvidia ( NVDA ) stock also appears to be moving lower alongside several tech names as traders brace for March’s Consumer Price Index (CPI) report, due Wednesday morning at 8:30 a.m. ET.

The previous two monthly CPI readings came in hotter than anticipated, tempering expectations for rate cuts from the Federal Reserve this year. Economists expect annual CPI inflation to have moved higher to 3.4% in March, up from 3.2% in February. Monthly CPI inflation is expected to rise 0.3%.

When the Bureau of Labor Statistics reported CPI for February last month, tech stocks underperformed the broader market as rate cut expectations fell.

New data this week reported by Reuters showed that rate cut expectations for 2024 have fallen to their lowest levels since October. At the start of the week, Fed funds futures contracts for December reflected expectations for around 60 basis points of rate cuts this year, versus the approximate 150 basis points that had been priced in at the beginning of the year.

Check This Out: March Inflation Data Preview: What Figures Would Boost Odds Of June Interest Rate Cut?

NVDA Price Action: Nvidia ( NVDA ) shares were down 3.20% at $843.46 at the time of publication, according to Benzinga Pro.