Riyadh – Business News Report|| Saudi Arabia’s annual inflation rate held steady at 1.9 percent during September, while consumer prices showed no monthly change. This stability occurred amid rising risks to global trade and energy supplies due to tensions in maritime routes. Such geopolitical friction could potentially drive up shipping costs and disrupt supply chains, creating pressure on domestic prices.
Data released by the General Authority for Statistics on Thursday highlighted that the Consumer Price Index rose by 1.9 percent year-on-year. This increase was primarily driven by a 3.6 percent jump in housing, water, electricity, gas, and other fuels. Food and beverage prices climbed by 1.4 percent, while transport costs increased by 2.3 percent compared to the same period last year.
Market Stability and Economic Confidence
Fadel bin Saad Al-Buainain, a member of the Shura Council, told Asharq Al-Awsat that the CPI remaining at 1.9 percent signals relative price stability. He described this as a positive indicator reflecting the Saudi economy’s ability to handle economic variables efficiently. Stable inflation provides consumers with clarity for budget management and supports investor confidence in the local market environment.
Al-Buainain emphasized that the true significance lies in balancing economic growth with mitigating living cost pressures. He noted that moderate inflation reflects effective policies aligned with Vision 2030 targets. However, he stressed the need to monitor housing and food prices to ensure stability translates into tangible improvements in purchasing power and quality of life.
Sectoral Variations and Rental Pressures
Dr. Salem Baajajah, an economics professor at King Abdulaziz University, pointed out significant variations across consumer basket components. Housing continued to lead inflation contributions alongside food and transport, while some goods saw price declines. He noted that rental rates growing faster than general inflation make the rental market a critical factor in assessing living costs.
Baajajah added that judging future trends requires monitoring upcoming months to see if stability persists or if rising rents accelerate the index. The statistics authority reported that housing and utilities rose 3.6 percent annually, driven by a 3.5 percent increase in actual rent prices. Personal care and other services rose 3.3 percent, fueled by an 11.9 percent surge in personal luggage, linked to a 12.9 percent rise in jewelry and watches.
On a monthly basis, the index remained flat against August. Housing and utilities rose 0.1 percent, as did food and beverages. Education services jumped 1.2 percent. Conversely, transport fell 0.1 percent, restaurants and accommodation dropped 0.5 percent, and recreation declined 0.6 percent. Housing contributed 0.7 percentage points to annual inflation, followed by food and transport at 0.3 points each.
This story was produced in the newsroom from the disclosed sources named above.
