Saudi Construction Index rises to 6-month high at 56.3 points in June

Riyadh city

The seasonally-adjusted Al Rajhi Capital Saudi Construction Index, compiled by S&P Global, rose to 56.3 points in June 2026 from 51.2 points in May.

The June reading marked a six-month-high, according to the data.

This release marks second 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.

The index recorded a sharp increase in June, remaining above the neutral 50-point threshold for the second consecutive month. The latest reading indicates the fastest rate of growth in construction activity since the survey began in January.

According to the index, growth in Saudi Arabia's construction sector gained huge momentum in June, backed by stronger performance across the three main segments covered by the survey.

Survey respondents largely attributed the rapid rebound in activity during June to the launch of new projects, greater regional stability, and the return of business activity to normal.

Index Performance YTD*

*MoM change.

The data showed that residential construction remained the best-performing segment in June, with growth accelerating to its highest level so far in 2026, as the index reached 58.4 points. Several surveyed firms reported a rebound driven by improved investor confidence and continued public-sector support for new housing projects.

The data also highlighted a strong recovery in non-residential construction works, with the index reaching 55 points. The pace of expansion rose to its highest level since February, with construction companies citing a healthy pipeline of commercial and industrial orders and projects, supported by strong domestic economic conditions.

Meanwhile, infrastructure construction activity returned to growth in June, with the index reaching 53.6 points. Survey participants attributed the increase in activity to the expansion of utility and transport-related projects, alongside continued investment spending associated with Saudi Vision 2030.

 Performance of Construction Activities – June 2026

According to the data, new business orders received by construction companies continued to recover in June, with the latest improvement marking the fastest pace since February. This reflected a strong increase in new orders across all major sectors.

Companies participating in the survey said that overall market conditions had improved, driven by easing geopolitical tensions and strong underlying demand fundamentals, particularly rapid urbanization and infrastructure development plans.

The June data also pointed to an improvement in supplier delivery times, at the fastest pace since February, despite some logistical challenges caused by shipping rerouting. Purchases of raw materials expanded for the first time in four months. However, input cost inflation remained elevated in June, with companies reporting higher prices for aluminum, cement, electrical equipment, and steel.

The data also showed an improvement in business confidence, with 49% of surveyed companies expecting business activity to increase over the next year, while only 8% anticipated a decline. This represents a rapid recovery from the record low seen in April and reflects the most optimistic growth expectations since the beginning of 2026.

Many companies also reported a surge in customer confidence during June, along with upcoming opportunities linked to government capital spending and economic diversification projects.