NCR construction retail price growth at 13-year high of 6.8%

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RETAIL PRICE growth of construction materials in the National Capital Region (NCR) was 6.8% in the first half, the highest level in 13 years, the Philippine Statistics Authority (PSA) said.

An economist said on Thursday that the price growth was driven by inflation and the reopening of the economy.

Growth in the PSA’s construction materials retail price index (CMRPI) in the NCR accelerated from 6.2% in May and 1.2% a year earlier.

In January 2009, the index posted growth of 7.4%.

In the first half, construction retail price growth averaged 5%.

Retail price growth in construction materials reflects activity by smaller-scale contractors or do-it-yourself hobbyists, as opposed to larger construction companies who buy their materials in bulk.

Asian Institute of Management Economist John Paolo R. Rivera said that inflation was a critical driver in the increase of the CMRPI.

He also added that international tensions such as the Russia-Ukraine conflict affect prices of materials due to supply chain disruptions. 

Inflation was 6.4% in July, the highest since the 6.9% reading in October 2018 as rising prices of fuel continue to affect other commodities and tight food supply pushes prices higher. 

The July inflation rate was at the upper end of the Bangko Sentral ng Pilipinas’ forecast for that month and well above the 2%-4% target band for 2022.

Among seven commodity groups, tinsmithry materials posted the highest growth rate to 9.4% in June from 8.3% in May.

The category’s year-earlier growth rate was 1.8%. 

Price growth also accelerated for plumbing materials (8.5% in June from 7.9% from May); painting materials and related compounds (4.6% from 4.1%); electrical materials (4.5% from 4%); miscellaneous construction materials (10.6% from 10.2%); masonry materials (4.3% from 3.9%); and carpentry materials (2.5% from 2.1%). — Bernadette Therese M. Gadon