Workers are seen installing steel at a construction site in Santa Cruz, Manila, Oct. 26, 2022. — PHILIPPINE STAR/EDD GUMBAN

By Lourdes O. Pilar, Researcher

THE RETAIL price growth of construction materials in Metro Manila slowed to 4.1% year on year in March, the Philippine Statistics Authority (PSA) reported on Friday.

This marks the slowest rate of growth in over a year, according to PSA data.

Based on preliminary PSA data, the rise in March construction materials retail price index (CMRPI) eased from 5.4% in February and 4.8% in March last year. 

Metro Manila's construction materials retail price index

The 4.1% reading in March was the lowest since February 2022 when retail construction materials prices grew at 3.3%. This was also the seventh consecutive month of slower annual growth rate.

During the first quarter, the CMRPI was up 5% from 3.7% comparable three months last year.

The PSA attributed the continued slowdown of CMRPI to the slowdown of the following commodities: miscellaneous construction materials, where price growth slowed to 6.2% from 9.3% in February; plumbing materials (2.2% from 4%); and tinsmithry materials (4.7% from 5.9%).

Lower annual increases in March were also seen in the indices of the carpentry materials (3.3 % from 3.8%), electrical materials (2.4% from 3.1%), and masonry materials (3.6% from 4%). Growth in the painting materials and related compounds steadied at 5.6%.

“The slowest year-on-year increase in the retail prices of construction materials in Metro Manila, at 4.1%, the slowest in more than a year, was largely brought about by the decline in global commodity prices in recent months,” Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort in an e-mail.

“Furthermore, the stronger peso exchange rate versus the US dollar recently, among the strongest for the peso in more than 8.5 months, also helped ease import prices, thereby leading to some easing in the wholesale prices of construction materials,” added Mr. Ricafort.

Mr. Ricafort added that inflation and interest rates had also dragged investments and overall demand, including construction activities, thereby partly slowing down prices of construction materials.

Preliminary data from the PSA showed annual headline inflation eased to 7.6% from 8.6% in February. However, this was faster than the 4% print a year ago. March inflation was the slowest since the 6.9% print in September 2022.

Core inflation, which strips out volatile prices of food and fuel, quickened to 8% in March from 7.8% in February.

“The further reopening of the local economy towards greater normalcy and continued increase in infrastructure spending would still be bright spots for the economy, thereby could still support the demand for construction materials, going forward,” Mr. Ricafort said.