Saudi Construction Index rises to 55.4 points in August

Saudi construction activity expands for fourth straight month.

The seasonally-adjusted Al Rajhi Capital Saudi Construction Index, compiled by S&P Global, edged up to 55.4 points in August 2026, from 55.2 points in July.

This release marks the fourth edition of the Al Rajhi Capital Saudi Construction Index, a new monthly survey of 200 construction companies that have been carefully selected to accurately represent the true structure of the Saudi Arabian construction sector.

Saudi construction companies recorded another output expansion in August, extending the current period of growth to four consecutive months. The index recorded its second-highest reading since the survey began in January, with the latest data indicating that business activity continued to expand at a robust overall pace. All three major sectors recorded growth, supported by continued strong demand and an ongoing recovery in new orders.

August data showed another sharp increase in total new business received by Saudi construction companies, while the infrastructure sector recorded the strongest performance, with the pace of expansion reaching its fastest since February. Residential construction followed closely, with new orders increasing at the strongest pace since the survey began in January.

*MoM Change.

Residential construction was the fastest-growing area of activity for the third time in the past four months, with the index at 57.5. Many firms cited strong growth momentum, supported by improving market conditions, the launch of new projects and work on major urban development projects.

Infrastructure activity also expanded at a strong pace in August, although growth slowed from July (index at 53.9). Despite the moderation, the latest increase remained stronger than at any point during the first half of 2026. Survey respondents pointed to development projects across various regions, utilities investments, new road construction and projects to improve transport network connectivity as factors supporting business volumes.

The non-residential structures segment also expanded at a strong pace in August (index at 53.5), supported by improving economic conditions and the resumption of projects. However, some construction firms noted slower decision-making and greater caution among clients.

Construction firms remained highly optimistic about the growth outlook, with 42% of survey respondents expecting business activity to increase over the next 12 months, while only 7% forecast a decline. However, this represented a lower level of optimism than in July.

Expectations for business activity over the next three months also remained positive, with confidence strongest in the residential construction and infrastructure sectors.

Firms widely reported improvements in expected workloads and an increase in the pace of new project starts, according to the survey.