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Saudi Gazette report
RIYADH — The annual inflation rate in Saudi Arabia reached 1.6% in August 2024, as reported by the Saudi General Authority for Statistics (GASTAT).
This increase was driven by an 8.9% rise in the prices of the housing, water, electricity, gas, and other fuels sector, and a 0.9% increase in the prices of food and beverages. In contrast, the prices in the transportation sector decreased by 3.4%.
Inflation ticked up from 1.5% in both June and July, following a three-month period of stability at that rate. The Saudi Cabinet highlighted the stable inflation rate of 1.5% in July as a sign of the robustness of the Saudi economy and the effectiveness of its measures against rising global prices.
Residential rents were the primary contributor to the inflation increase in August 2024 compared to the previous year. Housing rents surged by 10.7%, with a 10.8% rise in apartment rents significantly impacting the inflation rate due to the weight of this sector.
The consumer price index in August showed a slight 0.1% increase from July 2024, influenced by a 0.4% rise in the housing, water, electricity, gas, and other fuels sector, with actual housing rental prices increasing by 0.5%.
The International Monetary Fund (IMF), in its latest Article IV consultation report, projected that inflation in Saudi Arabia would remain controlled, supported by the credibility of the exchange rate peg to the dollar. Capital Economics also forecasted that Saudi inflation would generally remain low compared to other emerging markets, with a potential slight increase to 2% annually in the second half of the year.
