The value of the tender price index fell in three consecutive quarters to 96.6.
The Building and Construction Authority’s (BCA) Tender Price Index appears to have bottomed in recent quarters, as it fell from 96.7 in Q1 to 96.6 in Q3, UOB Kay Hian said.
According to BCA data, on a broader basis, index value fell from 104 in 2015 and then to 98 in 2016.
UOB Kay Hian said the decreases are likely on the back of imported inflation caused by higher steel prices.
In 2018, construction costs are expected to bottom out by -1% to +2%.
However, any further increase could also be restrained by competition from the current excess building contracting capacity, the broker concluded.
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