Saudi Arabia’s Inflation Stays at 2.2% in May, Mainly Due to Higher Housing and Jewelry Prices
Saudi Arabia’s yearly inflation rate stayed steady at 2.2% in May. Official data on Sunday showed that higher prices for housing and personal goods balanced out the lower costs of transportation and home furnishings.
Inflation Remains Steady in Saudi Arabia
Prices in Saudi Arabia stayed mostly steady, with a small increase in overall inflation. The rise was mainly due to a 6.8% jump in the cost of housing, water, electricity, gas, and fuel compared to last year, according to data from the General Authority for Statistics (GASTAT).
Rent prices for homes went up by 8.1%, especially because villa rents increased by 7.1%. Since housing makes up about 25.5% of the consumer price index, this had a big effect on inflation.
Food and drink prices rose by 1.6% over the year, mostly due to a 2.8% increase in meat and poultry prices. Personal goods and services became 4% more expensive, led by a sharp 24.4% rise in the prices of jewelry, watches, and antiques.
Restaurant and hotel prices went up by 1.8%, helped by a 1.6% rise in catering services. Education costs rose by 1.3%, mostly because of a 5.6% increase in non-university post-secondary education fees.
Some prices went down. Home furnishings and equipment dropped by 2.5%, with furniture, carpets, and flooring falling by 4%. Clothing and footwear prices went down 0.9%, driven by a 2.7% fall in footwear prices. Transportation costs dropped by 0.8%, mainly due to a 1.9% drop in car prices.
From April to May, prices increased slightly by 0.1%. This was due to a 0.3% rise in housing and utilities, including a 0.4% rise in rents. Food and beverage prices rose 0.1%, and personal goods and services went up by 0.5%. Tobacco prices increased by 0.2%.
However, monthly prices fell in some areas: furniture and home goods fell 0.7%, transport went down 0.2%, and clothes and shoes dropped 0.4%. Entertainment, culture, and communication each fell by 0.1%. Prices in education, health, and hospitality stayed mostly the same.
Saudi Arabia’s Economy Grows in Early 2025
In the first quarter of 2025, Saudi Arabia’s economy grew by 3.4% compared to the same time in 2024. This growth was mainly driven by strong performance in sectors outside oil, based on GASTAT data.
Non-oil industries grew by 4.9%, showing progress in the country’s Vision 2030 plan to reduce dependence on oil. Government services also grew by 3.2%, while oil-related activities fell slightly by 0.5%.
The non-oil sector was the biggest driver of economic growth, adding 2.8 percentage points to the total. Government services added 0.5 points, and taxes on products added 0.2 points.
Compared to the last quarter of 2024, Saudi Arabia’s real GDP (adjusted for seasons) rose by 1.1% in the first quarter of 2025, showing steady economic activity even with challenges in the energy sector.
Published: 16th June 2025
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