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Inflation accelerated to 1.9% y-o-y in October, up from 1.7% in September, according to the latest figures from the General Authority for Statistics (Gastat) (pdf). October’s readings mark the highest inflation rate seen so far this year. On a monthly basis, prices inched up 0.3%, driven by an 0.8% uptick in the combined housing, water, electricity, gas, and other fuels category.
IN CONTEXT- Inflation has been on an upward trajectory since August, largely driven by rising rental prices, following a two-month period where it held steady at 1.5% in June and July. Meanwhile, the International Monetary Fund sees Saudi inflation remaining stable at about 2% over the medium term, Reuters said.
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Home rentals are driving the increase: House rental prices — the heaviest weighted component in the domestic consumer basket — rose 11.6% y-o-y last month, on the back of a 11.3% surge in apartment rentals. This led to a 9.6% increase in the prices of housing, water, electricity, gas, and other fuels. Similarly, restaurant and hotel rates were up 1.9% during the period, driven by a 3.6% bump in hotel and serviced apartment fees.
Also feeling the pinch: Personal goods and service rates rose 2.3% y-o-y on the back of a 24.1% increase in the prices of jewelry, watches, and antiques. Education costs ticked up 1.1% y-o-y, led by a 1.8% rise in intermediate and secondary school fees, while food and beverage prices edged up 0.1% due to a 2.6% rise in vegetables.
Softening the blow: Furnishing and home appliance prices slipped 3.1% y-o-y, thanks to a 5% decrease in the prices of furniture, carpets, and flooring. At the same time, a 5.1% decline in ready-to-wear clothes pushed overall apparel and footwear prices down 2.7% y-o-y and transportation costs eased 3.1%, driven by a 4.2% drop in car prices.
MEANWHILE- Producer prices rose 2.4% y-o-y in October, on the back of a 12% increase in the prices of refined petroleum products, according to Gastat’s wholesale price index (pdf). Meanwhile, October wholesale prices were down 0.2% m-o-m.
Dive deeper into Gastat’s full report on October’s average prices of goods and services here (pdf).
