GROWTH in retail prices for building materials in Metro Manila continued in May to reach their highest level in more than 13 years, driven by the rising cost of imports and the reopening of the economy.
According to preliminary data from the Philippine Statistics Authority, the Retail Building Materials Price Index (CMRPI) in the National Capital Region (NCR) rose 6.2% year on year in May, compared to 6.1% posted in April and the growth rate of 1.2% year on year. earlier.
The 6.2% rate was the highest for building material prices in Metro Manila since the 7.4% growth recorded in January 2009.
The May 2022 result was also consistent with February 2009 retail building materials price growth.
This brought the NCR’s CMRPI for the first five months to 4.7% from 1.2% in the prior year period.
Security Bank Corp. chief economist Robert Dan J. Roces attributed May’s increase to the cost of imported building materials, which is rising due to supply chain issues, the reopening of the economy also adding to inflationary pressures.
“However, it may also be a function of the reopening story, which is doing well, and with activity at or very close to pre-pandemic levels,” Roces said in an email interview.
Global oil and commodity prices started rising even before Russia invaded Ukraine in February. The invasion eventually pushed oil prices above $100 a barrel.
Another factor is China’s Covid containment policy, which has caused congestion at the world’s busiest port of Shanghai. It has also stalled operations in key technology and financial hubs, dampening activity in the manufacturing and trade sectors.
China’s coronavirus countermeasures have hurt its economy.
Metro Manila and other parts of the Philippines have been placed under Alert Level 1, the most relaxed quarantine setting, since March.
Growth in building materials retail prices for most product groups accelerated in May, led by joinery materials, where prices rose 2.1% in May, versus the rate of growth in 1.5% recorded in April.
Retail prices in the following categories also increased: masonry materials (3.9% vs. 3.3%), paint materials and related compounds (4.1% vs. 3.7%) and materials tinsmithing (8.3% compared to 8.1%).
Price growth for plumbing materials and electrical materials remained unchanged from the previous month at 7.9% and 4%, respectively.
Price growth for miscellaneous building materials slowed to 10.2% in May from 10.6% in April.
Retail construction prices reflect demand from small-scale construction projects, including DIY builders and small contractors.
Construction activity should continue to pick up assuming there is no longer a lockdown, Mr Roces said. — Abigail Marie Pelea Yraola