Saudi Arabia Inflation February 2018

Saudi Arabia

Saudi Arabia: Inflation holds steady at an over four-year high in February

March 21, 2018

Consumer prices rose 0.1% from the previous month in February, decelerating sharply from January’s all-time high increase of 3.9%. The moderation largely reflected lower prices for transport and recreation and culture largely offsetting higher prices for food and beverages, and restaurants and hotels. That said, February’s soft reading comes after the introduction of a 5% Value-Added Tax (VAT) and government hiked domestic gasoline prices in January, which pushed up last month’s figure considerably.

Inflation was stable at January’s 3.0% in February, the highest reading in over four years. Meanwhile, the annual average variation in consumer prices rose to minus 0.3% in February from minus 0.5% in January.

Last month, the General Authority for Statistics changed the base year for the consumer price index from 2007 to 2013 and adjusted the basket of goods and services.

According to the 2018 budget unveiled in December 2017, the government expects inflation to reach 5.7% in 2018. FocusEconomics Consensus Forecast participants expect inflation to average 3.6% in 2018, which is down 0.2 percentage points from last month’s projection. The panel sees inflation averaging 2.5% in 2019.

Author:, Economist

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Saudi Arabia Inflation Chart

Saudi Arabia Inflation February 2018

Note: Year-on-year and month-on-month variation of consumer price index in %.
Source: General Authority for Statistics (GAS).

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