Inflation in Saudi Arabia Slows to 1.9%

SadaNews - Government data published today, Monday, showed that annual inflation in Saudi Arabia slightly slowed in November to 1.9%. The consumer price index ranged between 2.1% and 2.3% for most of the year, affected by rising housing prices.

The General Authority for Statistics attributed the rise in inflation in November to:

 An increase in housing, water, electricity, gas, and other fuel prices by 4.3%.

An increase in food and beverage prices by 1.3%.

An increase in transportation prices by 1.5%.

The authority clarified that housing rents rose by 5.4% and passenger transport service prices increased by 6.4%.

To counter the rise in rents, the General Authority for Real Estate in the Kingdom issued new regulations last September, which included suspending annual increases in rents for residential and commercial properties within the borders of Riyadh for five years.

Earlier this year, the government approved the "Non-Saudis' Property Ownership and Investment System," which will facilitate real estate purchases for foreigners when it comes into effect next year.

The Kingdom is currently working on establishing several major development projects around Riyadh as part of Vision 2030, aimed at boosting tourism and the private sector amid efforts to diversify the economy away from oil.

On a monthly basis, the consumer price index recorded an increase of 0.1% in November.

Budget 2026

At the beginning of this month, Saudi Arabia approved its general budget for 2026, anticipating a lower fiscal deficit, with a shift in spending towards priority sectors such as industry and logistics services and a focus on increasing non-oil revenues.

The Kingdom expects a deficit of 165.4 billion riyals ($44.06 billion) in its 2026 budget, which is lower than the 245 billion riyals ($65.3 billion) estimated for the deficit in the 2025 budget, affected by falling oil prices and production on revenues.

According to an announcement issued by the Saudi Cabinet, the budget for 2026 was adopted with:

Expenditures of 1.31 trillion riyals (about $349.7 billion), which is less than the 1.33 trillion riyals estimated for 2025.

Expected revenues of 1.147 trillion riyals (about $305.6 billion), a slight increase from the 1.09 trillion riyals estimated for the current year.

An estimated deficit of 165.4 billion riyals, equivalent to 3.3% of GDP, compared to an estimated deficit of 245 billion riyals for 2025.