Saudi Arabia's Inflation Rate Drops to Lowest Level in 5 Months in July

SadaNews - The annual inflation rate in Saudi Arabia slowed to its lowest level in five months, recording 2.1% in July compared to 2.3% in June, according to data released by the General Authority for Statistics on Thursday.

This was driven by a decrease in the pace of price increases in the "housing, water, and electricity" group due to the slowdown in residential rent increases, despite a slight acceleration in prices in the "food and beverages" group – which are the two most weighted groups in the Kingdom's consumer price index.

On a monthly basis, inflation in July remained stable with little change from the previous month.

Inflation in the Kingdom is expected to remain stable near 2%, according to estimates from the International Monetary Fund. This is attributed to the stability of the riyal's peg to the US dollar, continued local government support, as well as a decrease in transportation and communication costs, and a slowdown in the pace of residential rent inflation. It is also expected that the imported inflation resulting from rising global tariffs will remain under control.