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PPI for construction materials and components decreased in June

The seasonally adjusted producer price index (PPI) for materials and components used in construction fell 0.1 percent in June from May, according to The PPI program measures the average change over time in the selling prices received by domestic producers for their output.

The index was up 1.5 percent on a yearly basis. Nonresidential construction materials prices were unchanged in June, rose 0.1 percent for the quarter and increased 1.2 percent during the past 12 months.

“With the global economy beginning to tread water, the good news is materials prices are unlikely to rise significantly during the next several months,” says Associated Builders and Contractors Chief Economist Anirban Basu. “However, even as global economic growth slows, equity and certain other asset prices have been on the rise due in large measure to accommodative monetary policy.

“It is always possible that investors will begin to shift greater focus toward commodities going forward,” Basu continues, “which could drive materials prices higher even in the absence of accelerating global economic growth or significant rebound in America’s nonresidential construction industry.”

(From NRCA Newsletter)