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Purchaser costs in Saudi Arabia rose 3% in August on higher food and transport costs

Due to growing prices for food and beverages as well as transportation, costs in Saudi Arabia rose 3% in August.

The Consumer Price Index for August increased somewhat from the 2.7% increase seen in July and the 2.3% increase seen in June, according to data released on Thursday by the General Expert for Measurements (Gastat) of Saudi Arabia.

According to Gastat’s monthly CPI update, “the primary drivers of CPI inflation in August are the increased price of food and beverages [up 4%] and travel [up 4%].”

According to the research, the price of motor vehicles increased by 4.7%, which in turn raised transportation costs.

A 6.7% increase in the price of meat was the primary factor driving up prices in the food and beverage sector, which accounts for 18.8% of Saudi Arabia’s consumer basket.

According to the research, the price of motor vehicles increased by 4.7%, which in turn raised transportation costs.

Due to a 2.7% increase in residential rents, the cost of housing, water, electricity, gas, and other fuels also increased by 2.5%.

Personal goods and services prices climbed by 2.1% last month, while charges for dining out and lodging increased by 7.3% and tuition increased by 5.7% annually.

Due to a 1.4% decline in garment rates, the cost of clothing and footwear fell by 0.9%.
Consumer prices rose 0.4% last month compared to July 2022, primarily as a result of rising food and beverage prices, the study stated.

Following Russia’s invasion of Ukraine in February, food and commodity prices have increased dramatically, driving up inflation globally.

According to the International Monetary Fund, global inflation is expected to be 5.7% in advanced nations and 8.7% in emerging market and developing economies this year.

Nevertheless, the IMF anticipates that Saudi Arabia’s inflation would be kept under control at 2.8% in 2022 as the country’s central bank tightens monetary policy in accordance with the US Federal Reserve.
Additionally, Saudi Arabia has taken action to reduce the nation’s inflationary pressures. In July, it set aside 20 billion Saudi riyals ($5.3 billion) to lessen the impact of price increases on its people.

To assist those receiving social security benefits, the kingdom is transferring 10.4 billion riyals in direct cash payments. According to a royal edict signed by King Salman, the remaining funds would be used to boost strategic reserves of basic goods and assure their supply, according to the Saudi Press Agency.

A boost in per capita income and better business conditions in the nation also help to offset the effects of inflation.

According to a recent Gastat study, the kingdom’s GDP per person increased by 44.6% annually in the second quarter of the year to 29,819 riyals.

The coronavirus-caused slowdown in Saudi Arabia’s economy was quickly reversed, with the speed of growth increasing up this year as a result of a sharp increase in oil prices.

According to Gastat’s announcement last week, the kingdom’s economy expanded by 12.2% in the second quarter, the strongest rate in more than ten years.

In the second quarter of 2022, “all economic activity exhibited positive annual growth,” the report stated.
The IMF predicted that Saudi Arabia’s GDP would increase by 7.6% this year from 3.2 percent in 2021 in its World Economic Outlook update.

In 2022, non-oil growth will reach 4.2% before dropping back to its medium-term potential of 4%.

The fund predicted in August that the kingdom’s economy may have one of the strongest growth rates in the world this year.

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