Saudi inflation rate eases to 2.9% in November

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

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

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

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

The Saudi government, in its recently released budget statement, forecast inflation in the kingdom to average 2.6 per cent 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 per cent of GDP. It also revised its GDP growth forecast for 2022 to 8.5 per cent from eight per cent, 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. — Reuters

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