JEDDAH: Saudi Arabia’s annual inflation eased to 1.7 percent in October, matching the rate recorded in April and down from 1.9 percent in September, according to official data.  
 
Higher housing, transport and food costs continued to drive annual price growth, while consumer prices rose 0.1 percent month on month, according to a report by the General Authority for Statistics, or GASTAT.  
 
The housing, water, electricity, gas and other fuels category recorded an annual increase of 3.5 percent, with actual housing rents also rising by 3.5 percent. 
 
Insurance and financial services prices increased by 3.5 percent, led by a 6.5 percent rise in insurance services. Transport costs climbed 2.3 percent, while food and beverages prices rose 1.1 percent. Other categories recording annual increases included recreation, sport and culture, at 2.7 percent, and restaurants and accommodation services, at 1.8 percent. Education prices rose 1.3 percent, while personal care, social protection and miscellaneous goods and services increased by 1 percent.  
 
By contrast, prices for furnishings, household equipment and routine household maintenance declined by 0.5 percent, while clothing and footwear prices fell 0.2 percent. 

Housing drives inflation 

Housing and utility costs remained the largest contributor to annual price growth, followed by transport and food, according to GASTAT. 

“The housing, water, electricity, gas, and other fuels division was the main contributor to the annual inflation, with a contribution of 0.7 percentage points,” the authority said. 

Transport contributed 0.3 percentage points to the annual rate, while food and beverages added 0.2 percentage points. 

“The personal care, social protection, and other goods and services division contributed 0.1 percentage points, while the other divisions collectively contributed 0.4 percentage points,” GASTAT stated. 

Regional inflation pressures 

Inflationary pressures across the Gulf have intensified in recent months, driven largely by higher food and transport costs amid the regional conflict and disruptions to shipping through the Strait of Hormuz, according to a November analysis by Kamco Invest. 

Dubai recorded an annual inflation rate of 5 percent in September, the highest among the markets covered in the analysis, with transport costs rising 14.7 percent. Oman and Bahrain followed, both posting inflation of 3.2 percent in September, as food prices climbed 8 percent in each country. Transport costs increased 11.6 percent in Bahrain and 4.7 percent in Oman. 

Saudi Arabia recorded annual inflation of 1.9 percent in September, while Kuwait’s rate stood at 2.2 percent in July, supported by a 6.1 percent increase in food and beverage prices. Oman’s annual inflation subsequently eased to 2.9 percent in October, according to its National Centre for Statistics and Information. 

Despite the upward pressure, inflation across the Gulf Cooperation Council remains relatively contained compared with the wider region, supported by energy subsidies, administered prices and currency pegs, Kamco said. 
 
The investment firm cited International Monetary Fund projections showing average GCC inflation reaching 2.7 percent in 2026 before easing to 2.4 percent in 2027 and 2 percent from 2028 onward. 

Monthly prices edge higher 

On a monthly basis, the Kingdom’s consumer price index increased by 0.1 percent in October compared with September. 

Insurance and financial services recorded the largest monthly increase, at 1.5 percent, followed by clothing and footwear, which rose 0.4 percent. 

Housing and utility prices increased by 0.2 percent, with actual rents rising 0.4 percent. Food and beverages, recreation, sport and culture, and health prices also rose by 0.2 percent each. 

Information and communication prices edged up 0.1 percent, while personal care, social protection and miscellaneous goods and services declined by 0.6 percent. 

Prices in transport, restaurants and accommodation services, furnishings and household equipment, education, and tobacco remained unchanged from September. 
 
GASTAT said its consumer price index tracks changes in the prices of a fixed basket of 582 items, based on the 2023 Household Income and Expenditure Survey.