“Materials prices increased at the fastest monthly pace in two years in January,” Associated Builders and Contractors chief economist Anirban Basu said in a press release, noting that "this rapid escalation is largely due" to energy prices that rose sharply, traditional start-of-year price hikes by producers and a rush by many purchasers "to buy inputs before potential tariffs could go into effect.”

In the energy sector, monthly crude petroleum prices rose 14.8% in January, with natural gas up 13.7% and unprocessed energy material increasing by 13%.

Going forward, Basu said, “Tariffs are the only one [of these factors] that could continue to push input prices higher in the coming months. Import taxes allow domestic producers to raise their prices, and the new 25% levies on steel and aluminum will result in just that if they remain in place."

He added that the "combination of increased demand for construction inputs and ongoing supply chain confusion suggests input price escalation could accelerate through the first half of 2025.”