According to new data from Statistics Cyprus, the Construction Producer Price Index reached 122.07% in the fourth quarter of 2024 (2015 base = 100.00), an increase of 1.2% compared to the third quarter of 2024 and 4.8% compared to the same quarter of 2023.
By project type, the index rose by 1.4% for commercial building and 6.9% for civil engineering. In turn, from January to December 2024, the Construction Producer Price Index increased by 4.5% compared to the same period in 2023.0 For commercial buildings, the Index increased by 1.6%, while for civil engineering projects it increased by 16.6%.
As a reminder, the Producer Price Index is a measure of the average level of change in the wholesale prices of raw materials, inputs and intermediate goods at which domestic producers sell their goods.
The producer price index covers all stages of production: raw materials, intermediate goods, finished goods and all sectors. The main difference with the consumer price index is therefore that it covers only goods, not services, and at the wholesale level of their realisation. An increase in the producer price index could herald a further increase in property prices.
Statistics Cyprus also noted that in the fourth quarter of 2024, the construction production index reached 115.78 units (based on 2015 = 100.00), a decrease of 1.8 per cent compared to the fourth quarter of 2023.
By type of project, in the fourth quarter of 2024, compared with the corresponding quarter of 2023, the index for commercial buildings increased by 8.4% and the index for civil engineering projects increased by 14.6%. Finally, from January to December 2024, the construction output index increased by 3.5%. The index for commercial building increased by 6.5% over the year, while the index for civil engineering increased by 2.4%.
The quarterly Construction Production Index is a tool for monitoring short-term changes in construction activity. It is a volume indicator that approximates changes in value added at constant prices. It can therefore be seen as an indicator of the growth rate of the construction sector.