New data show that producer prices for softwood lumber are at the lowest levels since January 2017, right before the U.S. and Canada's trade battle caused lumber prices to soar.
The analysis comes from Bureau of Labor Statistics' non-seasonally-adjusted data, and Zillow director of economic research Aaron Terrazas writes that it is good news for American home builders, who have been grappling with rising materials, labor, and land costs. Recent trade battles with Canada and China (with tariffs on steel and aluminum), had been driving down builder confidence, causing them to "scale back" construction plans through to 2021.
New home sales have now registered their largest string of declines since 2010. At a time when the U.S. labor market is showing record unemployment lows and accelerating wage growth, home building has been a surprising weak point in an otherwise strong economy.