Inflation once again came in at 2.0% y-o-y in February 2025, remaining unchanged from January, according to the General Authority for Statistics’ (Gastat) latest consumer price index (pdf). Prior to January’s figures, the Kingdom has seen a continued overall upward trend in its inflation figures over the last five months, with December’s figures being the only decline in inflation since August.

On a monthly basis, consumer prices rose at a slower pace of 0.2%, on the back of a 0.4% rise in the housing, water, electricity, gas, and other fuels category, which was attributed to an equal rise in rent prices. The figure was also driven by a 0.7% rise in the prices of personal goods and services.

^^ Gastat’s full report on February’s average prices of goods and services is available here(pdf).

Rental prices were the culprit yet again: Housing, water, electricity, gas and other fuels — the heaviest component in the consumer basket — saw a 7.1% y-o-y increase, primarily driven by an 8.5% increase in rents paid for housing, as well as an 11.2% increase in villa rentals.

Food prices were up 1.0% during the month, driven by a 3.7% increase in meat and poultry prices. Meanwhile, restaurants and hotel prices rose by 0.8%, attributed to a 2.4% jump in the cost of hotel and furnished apartment services.

Education prices were also up in February, rising by 0.4% on the back of a 4.3% increase in fees of tertiary education.

A few items cooled off: Furnishing and home equipment prices continued to fall in February, logging a 2.5% y-o-y decrease, driven by a 4.4% decline in furniture, carpets, and flooring prices. Clothing and footwear prices also dropped 1.0%, driven by a 2.4% drop in ready-made clothing prices. Meanwhile, transportation costs went down by 1.5%, mainly due to a 2.4% decrease in vehicle purchase prices.

The figures came in line with analysts’ expectations: Capital Economics expects the Kingdom’s headline inflation rate to hover around 2.0% y-o-y until 4Q, before slowing back down towards the 1.0% mark. Meanwhile, the IMF sees inflation holding steady at 1.9% and 2.0% this year and the next, while Al Rajhi Capital sees inflation remaining stable at 2.1% in 2025 before cooling slightly to 2.0% in 2026.

WHOLESALE PRICE INDEX-

Producer prices were up by 1.5% y-o-y in February 2025, on the back of a 3.4% increase in the prices of other transportable goods, except metal products, machinery, and equipment, coupled with a 3.9% increase in the prices of agriculture and fishery products, according to Gastat’s wholesale price index (pdf). Meanwhile, February’s wholesale prices decreased by 0.5% m-o-m, due to a 1.4% decline in the prices of other transportable goods, except metal products, machinery, and equipment on a monthly basis.

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