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22 April 2024

Saudi inflation at 10 year high

By Agencies



Annual inflation in Saudi Arabia rose above 5 per cent in October to reach its highest in at least 10 years, propelled by rent and food costs, government data showed on Monday.
Inflation in the world's largest oil exporter accelerated to 5.35 per cent in October from 4.89 per cent in September, the Central Department of Statistics said in a statement.
Rent prices jumped 11.7 per cent in October, from 11 per cent in September, while food and beverage costs rose 7.5 per cent by October 31, compared with 7.2 per cent a month earlier, the data showed.
The central bank is constrained in the fight against inflation by the riyal currency's peg to the dollar. This forces it to track U.S. monetary policy at a time when the Federal Reserve is cutting interest rates and the U.S. currency is weak.
At a summit of Gulf Arab rulers last week, Saudi Arabian Finance Minister Ibrahim al-Assaf ruled out scrapping the riyal's peg to the dollar. But Gulf policymakers will meet within days to discuss currency revaluations, Bahrain's foreign minister said on Saturday.
Saudi Arabia's King Abdullah has ordered subsidies on imported rice and baby milk to cushion consumers from rising inflation, according to a decree published on Sunday.
Saudi money supply growth, an indicator of future inflation, rose to 21.11 percent in October, the central bank said last week. (Reuters)