Saudi Arabia Records 0.1% Dip in Consumer Prices, Signaling Continued Economic Stability

Saudi Arabia’s consumer prices declined by 0.1 percent in September compared to the previous month, reflecting continued economic stability and moderate inflationary pressure, according to the General Authority for Statistics (GASTAT).

The decline was primarily driven by lower transport costs and decreases in restaurant, accommodation, furnishing, and communication prices. Despite the monthly drop, the Kingdom’s annual inflation rate stood at 2.2 percent in September, largely supported by rising housing and utility costs.

GASTAT reported that the consumer price index (CPI) fell slightly due to a 0.4 percent decrease in the transport sector, driven mainly by a 1.4 percent drop in passenger transport prices. Restaurant and accommodation services also saw a 0.9 percent decline, while furnishings, home appliances, clothing, and footwear categories dropped 0.3 percent. Prices in communication and health sectors edged down by 0.1 percent.

However, some categories registered modest increases. Housing, water, electricity, gas, and other fuels rose by 0.4 percent, while food and beverages climbed 0.1 percent. Prices for personal goods and services also rose 0.4 percent. Education costs increased by 0.3 percent, and tobacco prices edged up 0.1 percent.

The Kingdom’s annual inflation rate remained broadly consistent with August’s figure, supported by a 5.2 percent increase in housing and utilities, offset by lower transport and hospitality costs. Rents paid for housing jumped 6.7 percent year-on-year, a significant factor given the category’s heavy weighting in the overall inflation index.

In March, Crown Prince Mohammed bin Salman introduced measures to stabilize Riyadh’s real estate market amid rising costs. As part of these efforts, new regulations were enacted in September, freezing residential and commercial rent increases in the capital for five years starting from September 25.

The food and beverage sector also experienced a 1.1 percent annual rise, driven by a 0.6 percent increase in meat prices. Meanwhile, restaurant and hotel prices rose 1.5 percent, fueled by a 1.9 percent increase in accommodation services. Personal care and other goods saw a 5.4 percent annual increase, driven by a sharp 16.3 percent rise in prices of personal effects.

According to GASTAT, the Wholesale Price Index (WPI) rose 2.1 percent year-on-year in September, mainly due to higher prices of transportable goods and agricultural and fishery products. Month-on-month, wholesale prices increased 0.3 percent, driven by higher metal, machinery, and furniture costs.

In its monthly goods and services bulletin, GASTAT reported that local tomatoes saw the sharpest price increase at 27.1 percent, followed by green beans, zucchini, and okra. On the other hand, furnished apartment rentals and hotel accommodations recorded the steepest declines, dropping by 9.2 percent and 5.8 percent, respectively.

The latest data aligns with the International Monetary Fund’s World Economic Outlook, which projects Saudi Arabia’s inflation to remain moderate—at 2.1 percent in 2025 and 2 percent in 2026—underscoring the Kingdom’s continued economic resilience amid global uncertainty.