Saudi Arabia: Inflation holds stable in April
Latest reading: Inflation came in at 2.3% in April, matching March’s 21-month high. Price pressures for food increased for the seventh consecutive month, stoked by higher import costs as a result of a weaker U.S. dollar, to which Saudi Arabia’s currency is pegged. On the other hand, housing cost growth eased to the lowest level in over two years, returning to more sustainable levels after booming on population growth and government-backed infrastructure projects.
The trend pointed up mildly, with annual average inflation coming in at 1.9% in April (March: 1.8%).
Lastly, consumer prices increased 0.32% in April over the previous month, accelerating from March’s 0.26% increase. April’s uptick marked the highest reading since April 2024.
Outlook: Since mid-April, our panelists have slightly raised their forecasts for inflation in 2025, reflecting the weaker outlook for the U.S. dollar as a result of Trump’s tariffs and the U.S. president’s proposed fiscal bill that would increase the budget deficit. That said, inflation will remain moderate, tempered by a cooling real estate market and lower prices for fuel.