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Saudi inflation rises to 3.3% on higher housing rents

Saudi unemployment Reuters
The finance ministry expected average inflation at 2.6% at the end of 2022

Saudi Arabia’s annual inflation rate ticked up to 3.3 percent in December from 2.9 percent in November, government data showed, with price rises again driven mainly by housing costs.

Prices rose 0.3 percent month on month in December, compared with a 0.1 percent monthly rise in November, Saudi Arabia’s General Authority for Statistics said.

Housing, water, electricity, gas and other fuels, with a 25.5 percent weight of the consumer basket, rose 5.9 percent from a year earlier and were 0.9 percent higher compared with November.

The statistics authority said the rise was “as a result of the increase in actual rentals for housing by 1.1 percent”.

Food and beverage prices, which were the main driver of inflation during much of 2022, fell 0.1 percent on a monthly basis, though they were still up 4.2 percent compared to December 2021.

“The annual consumer price index for 2022 increased by 2.5 percent compared to 2021, mainly influenced by the rise in food and beverage prices by 3.7 percent and transport prices by 4.1 percent, due to their weight in the index,” the General Authority for Statistics said in a separate report.

The housing category rose 1.8 percent in 2022, “mainly resulting from the increase in actual rentals for housing by two percent”, the authority said.

The finance ministry, in its 2023 budget statement, said it expected an average inflation rate of 2.6 percent at the end of 2022.