Saudi Arabia: Year-on-year consumer prices fall for the first time in over a decade in January
February 21, 2017
Consumer prices in Saudi Arabia declined 0.2% in January compared to the previous month, which followed December’s 0.5% decrease. January’s fall mainly reflected lower prices for restaurants and hotels, recreation and culture, and food and beverages.
On an annual basis, consumer prices fell in January for the first time in more than a decade, dropping by 0.4%. The reading contrasted December’s 1.7% growth and followed nearly a year of declining inflationary pressures. A weak economy and low export revenues were partially responsible for the drop. In addition, the moderation in price pressures in January reflected the end of a base effect from fuel and utility price hikes that took place in late 2015, which were no longer in the calculation. Meanwhile, annual average inflation fell from 3.5% in December to 3.1% in January.
Author: Christopher Thomas, Economist