The Federal Reserve Bank of St. Louis’ Producer Price Index for construction materials showed a consistent increase of nearly 3.2% over the first quarter of 2025, reflecting ongoing inflationary pressures in the construction industry.

This could be driven by several factors, including supply chain disruptions, labor shortages, and fluctuating demand for key materials such as steel, cement, and lumber. The increase in material costs is likely to affect overall project pricing in the next few months, with contractors potentially passing these costs onto developers. Moreover, the construction sector may experience delays or adjustments in timelines, as higher material prices could influence both large-scale infrastructure projects and residential developments. If these trends continue, they could affect the broader economy, especially in areas heavily reliant on construction activity.