Prices for Construction Materials, Nonresidential Buildings Each Rise by 0.6 Percent in January

Prices for materials used in construction and for nonresidential building construction both increased more than overall prices for "final demand" in January, according to a new analysis of retooled federal data on producer prices released today by AGC of America. As a result, margins remain very tight for most construction firms even as private-sector demand for construction continues to grow. "Although contractors on average were able to raise bid prices in line with materials cost increases, the results varied widely by commodity, building type and specialty trade," said Ken Simonson, the association's chief economist. "Several key construction materials, or 'processed goods,' experienced substantial price increases that in many cases exceeded what contractors could pass on last month. It will take a few more months to see if these costs increases are sustained - putting a squeeze on contractors' margins - or a one-time blip." Read the full release here.