JEDDAH — The deflationary trend in Saudi Arabia continued into the second half of 2017, with prices still 0.3 percent lower in July than the same time last year, Jadwa Investment said in its September 2017 Saudi Chartbook.

Brent oil prices were up by 8 percent, while WTI prices were up by 3 percent month-on-month. Prices were support by stronger demand during the summer months which was underlined by a sharp decline in US commercial oil stocks.

Rising domestic consumption resulted in Saudi Arabia pumping slightly above its oil production target in July for the first time since OPEC cuts were introduced at the beginning of year.

Economic data showed an improvement in activity in July. POS transactions jumped 12.8 percent, year-on-year, and ATM withdrawals were up 2.4 percent year-on-year.

In July, the net monthly change to government accounts with SAMA came out negative, falling by SR13.5 billion. Meanwhile, banks net holdings of government bonds rose by SR15.4 billion following a domestic sukuk issuance during the month.

SAMA foreign reserve assets dropped by $6.1 billion in July month-on-month, having risen for the first time in almost a year in the previous month.

Government deposits were up by SR3 billion month-on-month in July, but a decline in private sector deposits, by SR6.7 billion, pushed down total bank deposits by SR4.6 billion during the month.

Money supply rose by 2.7 percent year-on-year in July. Provisional weekly data shows the uptick in money supply is likely to continue into August.

A more dovish tone on interest rates by the US Federal Reserve (Fed) has led to declines against some currencies for the dollar.

In stock market, the benchmark Tadawul All Share Index was up 2 percent month-on-month in August as higher oil prices and solid second quarter listed company results, which were broadly in-line with

Q2 2017 listed company results were down 9 percent year-on-year, mainly as a result of a sizable drop in yearly net income in the materials segment. — SG