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Saudi Arabia Inflation

Saudi Arabia Inflation

Inflation in Saudi Arabia

From 2013 to 2022, Saudi Arabia's inflation rates were generally mild, dampened by government price controls and subsidies. That said, inflation spiked briefly in 2018 due to VAT implementation, and has been propped up post-Covid by higher international commodity prices and global supply constraints.

Consumer price inflation in Saudi Arabia averaged 1.8% in the ten years to 2022, below the Middle East & North Africa regional average of 5.4%. The 2022 average figure was 2.5%. For more inflation information, visit our dedicated page.

Saudi Arabia Inflation Chart

Note: This chart displays Inflation Rate (CPI, annual variation in %) for Saudi Arabia from 2022 to 2021.
Source: GEN. AUTHORITY FOR STAT., SAUDI ARABIA.

Saudi Arabia Inflation Data

2018 2019 2020 2021 2022
Inflation (CPI, ann. var. %, aop) 2.5 -2.1 3.4 3.1 2.5
Inflation (CPI, ann. var. %, eop) 1.9 -0.2 5.3 1.2 3.3
Inflation (WPI, ann. var. %, eop) 15.7 3.7 5.2 13.3 3.0

Inflation moderates in March

Inflation dropped to 1.6% in March, easing slightly from February’s 1.8%. As in past months, weak price rises for food and transport—subdued by government subsidies—kept a lid on price pressures. That said, rent prices continued to rise more quickly than general prices, as has been the case since September 2022, boosted by population growth following recent visa reforms and rapid non-oil economic growth. In addition, the trend pointed down slightly, with annual average inflation coming in at 2.0% in March (February: 2.1%). Finally, consumer prices fell 0.10% over the previous month in March, swinging from February's 0.18% rise. March's result marked the weakest reading since December 2021.

Our panelists expect inflation to cool slightly in 2024 from 2023, weighed on by the delayed effect of past interest rate hikes and subsidies on fuel and electricity. Stronger-than-expected rent prices and disruptions to shipping in the Red Sea pose upside risks. A strong U.S. dollar will limit the scope for upside surprises to inflation.

On the outlook, HSBC analyst Simon Williams said: “[We] see little pressure on consumer price inflation, which has eased over the past year and which we expect to remain low over our forecast period, despite gains in domestic demand. Rents may be an exception, however, as strong growth sees the population expand quickly, exposing capacity limits. The price of capital goods may also rise as development work gains, adding to already high project costs.”

Consensus Forecasts and Projections for the next ten years

How should you choose a forecaster if some are too optimistic while others are too pessimistic? FocusEconomics collects Saudi Arabian inflation projections for the next ten years from a panel of 28 analysts at the leading national, regional and global forecast institutions. These projections are then validated by our in-house team of economists and data analysts and averaged to provide one Consensus Forecast you can rely on for each indicator. By averaging all forecasts, upside and downside forecasting errors tend to cancel each other out, leading to the most reliable inflation forecast available for Saudi Arabian inflation.

Download one of our sample reports to visualize what a Consensus Forecast is and see our Saudi Arabian inflation projections.

Want to get access to the full dataset of Saudi Arabian inflation forecasts? Send an email to info@focus-economics.com.

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