Riyadh – The Saudi Arabian Monetary Authority (SAMA) has forecast that the kingdom's inflation would rise in the third quarter of 2018 on the back of economic reform measures.
Measures such as imposing a 5% value-added tax (VAT) on products and services, a correction in oil prices, and imposing higher fees on expats and their dependents will likely contribute to raising expenses and in turn inflation, SAMA said in its quarterly inflation report.
Moreover, the pilgrimage (hajj) season may improve domestic demand, prompting higher inflation, it said.
Saudi Arabia's inflation rose to 2.3% on an annual basis in Q2-18, although on a quarter-on-quarter basis, inflation was down 0.5%, SAMA's previous data showed.
© Mubasher 2018