Saudi Arabia's Construction Output Growth Eases in October Amid New Order Slowdown

05:11 AM EST, 11/05/2026 (MT Newswires) -- Saudi Arabia's construction output continued to expand for the sixth straight month in October, though momentum cooled as new orders recorded their weakest increase in five months. The seasonally adjusted alrajhi capital Saudi Construction Index ticked down to 52.3 from 54.4 in September, alrajhi capital and S&P Global said Thursday. Total new orders for the kingdom's construction industry saw moderate growth, primarily lifted by new infrastructure work. While client demand rose and market conditions remained "resilient," alrajhi capital and S&P Global noted reports from surveyed firms of longer wait times for project budget approvals amid heightened cost pressures. The surge in infrastructure activity also led to the sub-sector's highest reading since the survey's launch in January, while housing growth decelerated to its slowest pace since May. Conversely, work related to non-residential structures registered a slight drop amid delays in project execution, partly due to regional instability. Average cost burdens for Saudi construction companies rose sharply as prices for materials like steel and bitumen rose, driving overall inflation to its second-highest level since the survey began despite easing from September. Meanwhile, "resilient supply chain performance" and increased local sourcing helped prevent longer lead times. "Looking ahead, confidence remained positive across all three segments, with around 31% of firms expecting activity to rise over the next three months, compared with only 5% anticipating a decline. Planned project starts and resilient demand continue to support the sector's growth outlook," alrajhi capital's Head of Research Sultan Altowaim said.