Producer Prices Drop but Inflation Relief Is Still Threatened
WASHINGTON - "Inflation took a vacation in September for most of the economy but remains a problem for construction materials," said Ken Simonson, chief economist for The Associated General Contractors of America (AGC). Simonson was commenting on the Oct. 17 producer price index (PPI) report from the Bureau of Labor Statistics.
"Plunging petroleum prices drove down the overall producer price index and moderated the increase in the PPI for construction materials and components," Simonson commented. "The PPI for finished goods plunged 1.1 percent for the month, before seasonal adjustment, and was up only 0.9 percent compared to September 2005. But the PPI for construction materials and components rose 0.3 percent, the same as in August, and had a year-over-year increase of 8.1 percent, nine times as much as the overall index."