Construction Materials Prices Up 0.9% in September 2012
We may be in a period during which materials prices are set to increase, despite a lack of robust economic growth, said ABC's chief economist
“With investors becoming increasingly jittery about events in Europe, the Middle East and the United States, more money may be pouring into the commodity segments and less into stocks and bonds,” Basu said. “Policy announcements, including the latest word from the Federal Reserve on a third quantitative easing proposal, may accelerate the flow of money into commodities, resulting in higher prices in the absence of expanding global demand.
“We may be in a period during which materials prices are set to increase, despite a lack of robust economic growth,” said Basu. “Under various scenarios, financial markets could exhibit significant volatility going forward, causing some investors to place additional funds into hard assets like steel, oil, and copper. This would not be supportive of a construction spending recovery as projects become more expensive.”
View the August 2012 Producer Price Index report.
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