Saudi Arabia: Decline in consumer prices eases in June
July 19, 2017
Consumer prices rose 0.7% in June compared to the previous month (May: -0.2% month-on-month). The rise reflected much higher prices for tobacco as a result of the government’s decision to hike prices for tobacco and its derivatives. Higher prices for restaurants and hotels, and food and beverages also contributed to the monthly increase.
On an annual basis, prices fell for the sixth consecutive month in June, albeit at a softer pace. Consumer prices declined 0.4% in June, up from May’s 2.2% decrease. Meanwhile, annual average variation in consumer prices fell from 1.4% in May to 1.1% in June.
Inflation will gradually resurface in the coming months on the back of planned hikes in administered prices. Weak domestic demand and a strong currency, however, will keep inflation subdued.