Saudi inflation rate eases to 2.9 pct in November; housing costs behind price rises

Saudi Arabia’s annual inflation rate eased to 2.9 percent in November from 3 percent in October, government data showed on Thursday, with price rises driven mainly by housing costs.

Consumer prices increased slightly by 0.1 percent compared to October, Saudi Arabia’s General Authority for Statistics said.

Housing rents rose by 5.4 percent, pushing the overall increase in housing, water, electricity, gas, and other fuels to 4.7 percent.

Food prices, which have been the main driver of increases in the last couple of months, increased by 3.6 percent while transport
costs rose 4 percent.

The Saudi government, in its recently released budget statement, forecast inflation in the Kingdom to average 2.6 percent by the end of 2022 “under the exceptional global circumstances.”

High oil prices have helped Saudi Arabia’s fiscal balance to tilt to its first surplus since 2013 this year, at 2.6 percent of GDP.

It also revised its GDP growth forecast for 2022 to 8.5 percent from 8 percent, boosted by an expansion in non-oil private sector activity.

While most Gulf central banks have raised interest rates in line with the Federal Reserve’s moves — most recently on Wednesday — governments in the region have also taken measures to limit the impact of rising prices, such as capping fuel prices.