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20 July 2017
Saudi Arabia’s general index of cost of living recorded a 0.4 percent year-on-year decrease in June, the General Authority for Statistics reported this week.
The kingdom in January reported deflation in consumer prices for the first time in over a decade, according to a Reuters report, as the economy continued to suffer as a result of low oil prices and the drop in government revenues.
The deflation in June was mainly attributed to the drop in clothes and footwear segment, which was down by 3.5 percent, followed by restaurants and hotels (down by 2.4 percent), food and beverages (2.2 percent), recreation and culture (1.9 percent) and transport (1.5 percent).
Meanwhile, tobacco went up by 74.4 percent following the implementation of 100 percent selective tax in June, but that increase did not have a significant impact on the overall cost of living index.
However, global research firm Capital Economics predicted that the period of deflation may not last much longer and that inflation will rise again above 4 percent after the value-added tax is introduced.
Further reading:
Vision 2030: ZAWYA's Special Coverage on Saudi Transformation
© Express 2017
Saudi Arabia’s general index of cost of living recorded a 0.4 percent year-on-year decrease in June, the General Authority for Statistics reported this week.
The kingdom in January reported deflation in consumer prices for the first time in over a decade, according to a Reuters report, as the economy continued to suffer as a result of low oil prices and the drop in government revenues.
The deflation in June was mainly attributed to the drop in clothes and footwear segment, which was down by 3.5 percent, followed by restaurants and hotels (down by 2.4 percent), food and beverages (2.2 percent), recreation and culture (1.9 percent) and transport (1.5 percent).
Meanwhile, tobacco went up by 74.4 percent following the implementation of 100 percent selective tax in June, but that increase did not have a significant impact on the overall cost of living index.
However, global research firm Capital Economics predicted that the period of deflation may not last much longer and that inflation will rise again above 4 percent after the value-added tax is introduced.
Further reading:
Vision 2030: ZAWYA's Special Coverage on Saudi Transformation
© Express 2017
