Nov. 20, 2006: Producer Prices Drop in October but Threat to Construction Remains
"Plunging petroleum prices drove down the overall producer price index for the second straight month and lowered the PPI for construction materials and components for the first time since Hurricane Katrina struck in August 2005," Simonson said. "The PPI for finished goods dived 1.6 percent for the month and for the 12 months back to October 2005. The PPI for construction materials and components slipped 0.2 percent for the month but had a year-over-year increase of 6.5 percent.
"The 12-month increase for most construction inputs was milder than in recent months, thanks to easy comparisons to the immediate post-hurricane period and to fast-shrinking demand from home builders," Simonson observed. "But aside from wood products and diesel fuel, most inputs still had hefty year-over-year increases. For instance, from October 2005 to October 2006 there were double-digit increases in the PPI for copper and brass mill shapes, up 64 percent; asphalt paving mixtures and blocks, 30 percent; steel mill products, 21 percent; gypsum products, 15.5 percent; and aluminum mill shapes, 12.5 percent.