Construction costs rose at the slowest pace in four months in December as prices for inputs used in building construction and building completion and finishing fell.
The construction input price index — which measures changes in the costs incurred by contractors in completing construction projects on items such as wages, materials, and plant & equipment — increased 1.6 per cent year-on-year in December, according to a report by the Uganda Bureau of Statistics.
Ubos attributed the slowdown in civil engineering works input inflation to a 0.2 per cent fall in the price of inputs for road and railway construction, compared to a 1.2 per cent rise in November. Input inflation for the construction of utility projects also decreased.
In addition, construction costs for buildings moderated due to lower input inflation for residential buildings. The cost of materials for non-residential construction also slowed.
The report said that the annual average inflation rate for the construction sector was 3.7 per cent in 2023, down significantly from 8.3 per cent in 2022.
Monthly construction inflation rose 0.1 per cent, following a decrease of the same magnitude in November. This was due to an increase in the prices of inputs used in the construction of buildings and building completion and finishing.
The input price index for building construction increased by 0.1 per cent on the month, after a fall of 0.2 per cent in November; the same trend was observed for its two sub-categories, residential buildings and non-residential buildings.
Input costs for specialised construction activities rose 0.1 per cent, after a fall of 0.1 per cent in the previous month. This was due to an increase in the prices of inputs used in building completion and finishing, and in demolition and site preparation.
Ubos said construction products whose prices rose during the month included sand, paints and varnishes, clay bricks and tiles, and cement. Overall, the price of materials increased by 0.1 per cent in December, reversing a fall of the same magnitude in November, while the cost of utilities, equipment hire, and labour remained unchanged.
