Malawi construction cost inflation slows
General Construction Input Price Index rose 4.4 percent in Q2 2026/27, down from 6.2 percent.
Malawi's construction cost inflation slowed in the second quarter of the 2026/27 financial year, with the General Construction Input Price Index (GCIPI) rising by 4.4 percent between July and September 2026. This marks a decrease from the 6.2 percent increase recorded in the preceding quarter, according to figures from the Construction Industry Regulatory Authority (Cira) and the National Statistical Office (NSO). Annually, construction cost inflation eased to 21.3 percent from 28.8 percent in the first quarter, a reduction of 7.5 percentage points.
Cira chief executive officer Engineer Gerald Khonje stated that the pace of price increases has moderated significantly, reflecting improving stability within the industry, although construction inputs remain more expensive than a year ago. Civil engineering saw quarterly input price inflation decline to 3.4 percent from 8.1 percent, while building construction recorded a slight quarterly increase to 5.1 percent from 5.0 percent.
Despite the easing cost indicators, the Reserve Bank of Malawi (RBM) revised its construction sector growth projection for 2026 downwards to 4.2 percent, citing foreign exchange shortages, rising fuel prices, and supply constraints. Economist Velli Nyirongo noted that imported materials, financing costs, and transport remain significant constraints for contractors and developers.
Why it mattersMalawi's construction sector growth projection has been revised downwards due to persistent foreign exchange shortages and fuel supply challenges.