Construction input prices increased 0.2% in March, according to an Associated Builders and Contractors analysis of U.S. Bureau of Labor Statistics Producer Price Index data released today. Nonresidential construction input prices rose 0.4% for the month.
Overall construction input prices are 0.9% lower than in March 2022, while nonresidential construction input prices have fallen 0.6% over the past year. Construction input prices are now up 39.0% since February 2020, the month before the COVID-19 pandemic began.
“Construction input costs are down on a year-over-year basis for the first time since August 2020,” said ABC Chief Economist Anirban Basu. “The good news is that the latest PPI data, which show broad-based declines in both goods and services prices, suggest that the expected 25 basis point interest rate hike at the Federal Reserve’s May meeting will be the last of the cycle.
“The bad news is that this data indicates greatly diminished pricing power among wholesalers and others,” said Basu. “While some will cheer the notion that rate increases are set to end soon, the Federal Reserve may want to maintain higher interest rates for longer to ensure that inflation has been suppressed. This, along with other signs of slowing economic activity, suggests that the possibility of recession remains elevated, though the economic outlook is increasingly uncertain.”
Related Stories
Building Team | Jul 18, 2022
Understanding the growing design-build market
FMI’s new analysis of the design-build market forecast for the next fives years shows that this delivery method will continue to grow, despite challenges from the COVID-19 pandemic.
Market Data | Jul 1, 2022
Nonresidential construction spending slightly dips in May, says ABC
National nonresidential construction spending was down by 0.6% in May, according to an Associated Builders and Contractors analysis of data published today by the U.S. Census Bureau.
Market Data | Jun 30, 2022
Yardi Matrix releases new national rent growth forecast
Rents in most American cities continue to rise slightly each month, but are not duplicating the rapid escalation rates exhibited in 2021.
Market Data | Jun 22, 2022
Architecture Billings Index slows but remains strong
Architecture firms reported increasing demand for design services in May, according to a new report today from The American Institute of Architects (AIA).
Building Team | Jun 17, 2022
Data analytics in design and construction: from confusion to clarity and the data-driven future
Data helps virtual design and construction (VDC) teams predict project risks and navigate change, which is especially vital in today’s fluctuating construction environment.
Market Data | Jun 15, 2022
ABC’s construction backlog rises in May; contractor confidence falters
Associated Builders and Contractors reports today that its Construction Backlog Indicator increased to nine months in May from 8.8 months in April, according to an ABC member survey conducted May 17 to June 3. The reading is up one month from May 2021.
Market Data | May 18, 2022
Architecture Billings Index moderates slightly, remains strong
For the fifteenth consecutive month architecture firms reported increasing demand for design services in April, according to a new report today from The American Institute of Architects (AIA).
Market Data | May 12, 2022
Monthly construction input prices increase in April
Construction input prices increased 0.8% in April compared to the previous month, according to an Associated Builders and Contractors analysis of U.S. Bureau of Labor Statistics’ Producer Price Index data released today.
Market Data | May 10, 2022
Hybrid work could result in 20% less demand for office space
Global office demand could drop by between 10% and 20% as companies continue to develop policies around hybrid work arrangements, a Barclays analyst recently stated on CNBC.
Market Data | May 6, 2022
Nonresidential construction spending down 1% in March
National nonresidential construction spending was down 0.8% in March, according to an Associated Builders and Contractors analysis of data published today by the U.S. Census Bureau.
