Saudi Gazette report

RIYADH — The consumer price index or inflation in Saudi Arabia remained almost steady at 1.6 percent during the last month of January compared to 1.5 percent during December 2023. The inflation registered a slight increase of 0.1 percent during January against the previous month, according to the latest monthly report published by the General Authority for Statistics (GASTAT).

On a year-on-year basis, there has been an increase in the prices of housing, water, electricity, gas and other types of fuel by 7.8 percent during the last month while compared to January 2023. Actual residential rents rose by 9.3 percent in January, affected by an 8.2 percent increase in villa rental prices. The prices of food and beverages rose by 1 percent in January compared to the same month in 2023. The rise in this group had a significant impact on the rise in annual inflation in January. Prices for furnishings, household equipment and maintenance decreased by 3.3 percent year-on-year basis in January.

Last month, the consumer price index recorded a slight increase of 0.3 percent with regard to prices of food and beverages compared to December 2023 while restaurant prices increased by 0.2 percent. The entertainment and culture section recorded an increase of 1.4 percent. In contrast, transportation prices decreased by 1.1 percent, clothing and footwear prices dropped by 0.6 percent and prices of miscellaneous personal goods and services decreased by 1.1 percent. It is noteworthy that inflation rate in Saudi Arabia was slowed in December 2023 to the lowest level in 23 months when it reached 1.5 percent on an annual basis compared to 1.7 percent in November.

During the entire year of 2023, the average inflation rate was 2.3 percent, down from 2.5 percent for 2022, according to the GASTAT report. The 2023 data was lower than the Ministry of Finance’s estimates, which expected the inflation rate to reach 2.6 percent last year. The ministry expects inflation rates to decline to 2.2 percent in 2024, and to reach 2.1 percent in 2025. The expectation is that in 2026, inflation rates in the Kingdom would reach only 1.9 percent.

The Saudi government has adopted proactive measures and policies to contain rising prices, setting a ceiling on gasoline prices and raising the level of food stocks, in addition to supporting social protection programs.