Saudi deflation continues for third consecutive month

Deflation in Saudi Arabia continued for the third consecutive month and reached 0.4 percent, up from 0.1 percent in February, said a Jadwa Investment report issued on Sunday.

Although foodstuffs registered deflation, it was at a slower year-on-year rate of 2.7 percent, compared to 3.4 percent in February.

According to the report, year-on-year housing and utilities inflation slowed to 0.68 percent, compared to 1.4 percent last month, due to slower growth in rental for housing.

Economic data for March showed that economic activity in the Kingdom had mildly improved, with cash withdrawals from ATMs and point of sale (POS) transactions showing rises.

In March, the report showed, the net monthly change in government accounts with the Saudi Arabian Monetary Agency (SAMA) came out negative, falling by SR4 billion.
Also during the month, SAMA foreign exchange (FX) reserves fell to $508 billion, representing a $5.4 billion decline on a month-on-month basis.

Analysts expect the international Islamic bond issued in April to alleviate the pressure on FX reserve withdrawals in the months ahead.

Year-on-year growth in bank credit to the private sector in March turned negative for the first time in at least 11 years. (Source credit – Arab News)

 

Comments

comments