Prices for inputs to new residential construction—excluding capital investment, labor, and imports—decreased 0.6% in September, according to the latest Product Price Index (PPI) report from the U.S. Bureau of Labor Statistics. Compared to a year ago, the index was down 0.1% in September.
In a breakdown of the report, the NAHB said prices for goods decreased 0.7% on a year-over-year basis while prices for services increased 1.0%.
The goods component has a larger importance to the total residential construction inputs price index, around 60%. The price of input goods to residential construction was down 0.7% in September from August. The input goods to residential construction index can be further broken down into two separate components, one measuring energy inputs with the other measuring goods less energy inputs. The latter of these two components simply represents building materials used in residential construction, which makes up around 93% of the goods index.
Prices of inputs to residential construction services, fell 0.5% in September from August. The price index for service inputs to residential construction can be broken out into three separate components: the trade services component, the transportation and warehousing services component, and the services less trade, transportation and warehousing component. The most vital component is trade services (around 60%), followed by services less trade, transportation and warehousing (around 29%), and finally transportation and warehousing services (around 11%). The largest component, trade services, compared to last year was up 0.4% in September after increasing 2.1% in August.
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