The Saudi economy has recorded a new positive indicator reflecting the Kingdom's financial and monetary stability. The latest official data shows that the Consumer Price Index (CPI), the inflation rate in Saudi Arabia, slowed to 1.9% year-on-year in November 2025. This is the lowest rate recorded in the Kingdom in nine months, indicating the success of economic policies in curbing prices and maintaining consumer purchasing power.
Key indicators details
According to the report issued by the Saudi General Authority for Statistics, price movements varied among different sectors, with the details as follows:
- Housing and Utilities: The housing, water, electricity, gas and other fuels section recorded an increase of 4.3%.
- Food and beverages: saw a slight increase of 1.3%.
- Transportation: Prices increased by 1.5%.
This overall slowdown in inflation reflects the Saudi economy’s ability to absorb global shocks and market fluctuations, especially in light of the economic challenges facing many major countries.
The housing sector: the main driver of change
The housing sector continues to play a major role in influencing inflation rates in the Kingdom. Data shows that residential rents were the biggest driver during November 2025 compared to the same month in 2024. The 4.3% increase in the housing and utilities sector is mainly attributed to a significant 5.4% rise in the "actual residential rents" category.
This rise in rents can be interpreted in the context of the significant economic activity taking place in the Kingdom, particularly in major cities like Riyadh, as a result of attracting global companies and talent within the "Saudi Vision 2030" programs, which has increased the demand for housing units.
Consumer goods and luxury items
In a related development, the food and beverage sector was affected by a 1.6% increase in fresh and chilled meat prices. Meanwhile, the transportation sector saw its rise driven by a 6.4% increase in passenger transport service prices.
A notable finding in the report is the significant 6.6% jump in the "Personal Care, Social Protection, and Other Goods and Services" category, driven primarily by a 19.9% increase in personal luggage prices. This rise is directly linked to a 21.9% increase in jewelry and watch prices, which typically aligns with global gold and precious metal price movements, making this segment of inflation imported and linked to external factors.
The economic importance of slowing inflation
The decline in the inflation rate to below 2% carries significant economic implications; it strengthens the investment environment in the Kingdom and empowers the private sector with greater capacity for stable financial planning. Furthermore, maintaining inflation at acceptable levels is a cornerstone for preserving the standard of living for citizens and residents, and it underscores the effectiveness of the fiscal and monetary policies pursued by the Saudi Central Bank and the government to ensure sustainable economic growth, free from sharp fluctuations.
