Building Cost Inflation Rises to 4.6% Despite Lower Cement, Steel Prices

Building cost inflation in Ghana increased to 4.6% in August 2026, up from 4.0% in July, despite declines in the prices of key inputs such as cement, steel and labour.

The latest Prime Building Cost Index (PBCI) from the Ghana Statistical Service (GSS) shows that building input prices increased by 0.1% between July and August.

Despite the monthly rise, the August inflation rate was significantly lower than the 12.0% recorded in August 2025, indicating a substantial moderation in construction cost pressures over the past year.

The PBCI stood at 138.4 in August 2026, compared with 132.3 a year earlier.

Materials remain major driver

Materials remained the largest contributor to overall building cost inflation, recording 5.8% year-on-year inflation.

The category accounts for 76.5% of the PBCI basket and contributed 96.5% of the upward pressure on the headline rate.
However, the GSS identified plant and equipment costs as an emerging source of pressure, with inflation in the category reaching 17.9% in August.

According to the Service, the increase was partly driven by higher costs for small tools and equipment, which recorded inflation rates of 23.4% and 10.7%, respectively.

Labour costs, on the other hand, provided some relief to contractors, declining by 2.9% year-on-year.

Skilled labour costs fell by 1.8%, while unskilled labour recorded a 4.6% decline.

Mixed movements in construction inputs

The latest data showed significant differences in price movements across construction inputs.

Plumbing recorded the highest increase at 26.1%, followed by reinforcement at 24.2%, small tools at 23.4%, roofing sheets at 21.7% and glazing at 20.4%.

Meanwhile, steel prices declined by 8.9%, cement by 7.1% and fine aggregate by 5.1%.

Electrical works accounted for the largest share of the upward movement in the 4.6% headline inflation rate, contributing 44.1%.

This was followed by metalwork at 25.0%, glazing at 22.9%, plumbing at 19.5% and tiles at 13.9%.

GSS advises businesses and households

The Ghana Statistical Service has advised construction businesses to base contract pricing on current market conditions and carefully manage their exposure to plant, tools and materials experiencing high inflation.

It also recommended flexible procurement arrangements and transparent price-adjustment clauses to help businesses manage fluctuations in input costs.

For households undertaking construction projects, the Service encouraged builders to update their budgets using current market prices, consider phased construction where possible and compare quotations from different suppliers.

The GSS said the latest data also presents an opportunity for government to improve project delivery by closely monitoring plant and installation costs while strengthening artisan skills, procurement data and local supply chains.

The August PBCI was compiled from monthly prices for 406 construction items collected from 489 outlets across 16 markets. The index covers construction materials, labour, plant and equipment.