Brazil’s FGV construction cost index rises 0.56% in August, 17.05% last 12 months

RIO DE JANEIRO, BRAZIL – The National Construction Cost Index – M (INCC-M), published by the Brazilian Economic Institute of the Getúlio Vargas Foundation (FGV/Ibre), rose 0.56% in August, following a 1.24% increase in the previous month.

With this result, the index reached 11.37% for the year and 17.05% over 12 months. In August 2020, the index was up 0.82% and had a 12-month increase of 4.44%.

The materials, equipment, and services index rate decreased from 1.37% in July to 1.10% in August. Materials and equipment rose 1.17%, down from 1.52% the previous month. Rates of change declined for two of the four subgroups of components, most notably building materials, which fell to 1.05% from 1.85%.

The services sector declined from 0.65% in July to 0.78% in August. In this group, FGV Ibre highlighted the increase in the rental rate for machinery and equipment, which rose from 0.61% to 1.37%.

Labor costs remained stable in August, after increasing 1.12% in the previous month.

Five state capitals recorded a decrease in their variation rates for the INCC-M: Salvador, Recife, Rio de Janeiro, Porto Alegre, and São Paulo. In Brasilia and Belo Horizonte, on the other hand, the rates of variation increased.

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