By Sam Bridge
Jadwa Investment forecasts 1.7% inflation rate in Gulf kingdom this year as non-oil economy is expected to expand
Inflation forecasts for Saudi Arabia in 2020 have been revised upwards to 1.7 percent to reflect expectations of a continued pick-up in non-oil activities, and an elevated level of consumer spending.
A new research note from Jadwa Investment, analysing latest General Authority for Statistics (GaStat) data for December, showed that prices were up by 0.2 percent year-on-year, and by 0.1 percent month-on-month.
It added that the annual inflation rate for 2019 averaged 1.2 percent year-on-year, in line with Jadwa's forecast.
During 2019, the highest price rises was seen in restaurants and hotels at 1.7 percent, followed by education at 1.6 percent year-on-year.
Jadwa said price rises in restaurants and hotels were a result of increasing demand in entertainment and tourism in the kingdom, following the emerging activities associated with the Saudi Seasons in different regions during 2019.
The largest decline in prices came in housing and utilities, down by 6.5 percent year-on-year, mainly as a result of rentals for housing, which declined by 7.4 percent year-on-year in 2019.