Saudi Arabia: Consumer prices record seventh consecutive fall in July
August 15, 2017
Consumer prices rose 0.1% in July on a monthly basis, which was below June’s 0.7% increase. July’s growth was supported by price increases for tobacco resulting from the government’s decision to hike prices for tobacco and its derivatives. The pace of tobacco price increases, however, slowed compared to June, and this largely explains the overall deceleration.
On an annual basis, consumer prices fell for the seventh consecutive month in July, dropping 0.3% (June: -0.4% year-on-year). Meanwhile, annual average inflation fell from June’s revised 1.2% reading (previously reported: +1.4%) to 0.8% in July.
The Central Bank expects inflation to potentially pick up in the coming months on the back of labor market reforms and seasonal factors such as the beginning of the Hajj.
Author: Edward Gardner, Economist