PRICE GROWTH of construction materials in the National Capital Region (NCR) eased further in May, the Philippine Statistics Authority (PSA) reported on Thursday.
According to preliminary data, year-on-year growth of the construction materials wholesale price index (CMWPI) slowed to 0.6% from 0.7% in April.
The May reading was also far below the 6.6% growth posted in May 2023.
The May outcome was the lowest year-on-year growth on record after the 2018 rebasing.
At the end of April, CMWPI growth averaged 0.9%, against 7.9% in the same period last year.
“The slower year-on-year growth in construction materials wholesale prices in Metro Manila may have to do with lower global crude oil and other global commodity prices,” Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in an e-mail.
He added that higher global interest rates could have slowed global trade and economic activity, leading to lower demand for commodities including those used in construction.
Slower growth was recorded in nine commodity groups: G.I. sheets (3.1% from 3.2%), hardware (2.7% from 3%), electrical works (1.7% from 2.6%), painting works (1.6% from 1.9%), plywood (1.4% from 1.5%), structural steel (1.1% from 1.6%) doors, jambs, and steel casements (0.9% from 1%), PVC pipes (0.7% from 0.9%), and lumber (0.4% from 0.5%).
The slowdown in CMWPI growth was attributed to the slower annual increase in electrical works prices, the PSA said.
Three commodity groups posted stronger price growth in May: fuels and lubricants, 15.3% from 10.9%; metal products, 1% from 0.7%; and plumbing fixtures and accessories/waterworks, 0.5% from -0.2%.
Mr. Ricafort expects global and Philippine interest rates to affect prices going forward.
“The possible cut in Fed and Philippine interest rates later in 2024 and 2025 could lead to some pick up in demand and prices of construction materials,” he said.
The Fed kept its policy rate at 5.25-5.5% on Wednesday, signaling rate cuts being delayed to as far back as December, Reuters reported on Thursday. — Karis Kasarinlan Paolo D. Mendoza
