Kuwait, Kuwait – A report by the Statistical Center of the Gulf Cooperation Council (GCC) states that the GCC inflation rate remained stable at 1.8% during 2025, remaining below 2% for the second consecutive year.
This reflects the success of the GCC countries’ economic and monetary policies in containing price pressures.
Furthermore, the GCC countries maintained economic stability despite ongoing global fluctuations.
Gulf economies outperform major economies
The report explained that the inflation rate in the GCC countries was lower than that of many global economies.
It reached 5.3% in emerging and developing economies, 2.5% in the European Union, 2.6% in the United States, and 3.2% in Japan.
Therefore, GCC inflation remains less than half the global average. It is also lower than that of most major trading partners.
The report indicated that GCC inflation was 1.5% in 2020, then rose to 3.2% in 2022.
It subsequently declined to 2.3% in 2023 and 1.6% in 2024, finally stabilizing at 1.8% in 2025.
Housing and the most impactful goods and services
The report indicated that the highest inflation rates were recorded in the miscellaneous goods and services group at 5.4%,
followed by housing at 4%. Culture and entertainment came next at 2%, while restaurants and hotels registered 1.6%.
Food and beverages reached 1.2%, and education 1%. In contrast, the transport group saw a decrease of 0.2%.
The report added that housing accounted for 48.9% of the Gulf inflation contribution.
The goods and services sector followed with 24.3%, and food and beverages contributed 14.1%.
This suggests that inflationary pressures are primarily driven by domestic factors.
Saudi Arabia leads in inflation contribution
The report pointed out that Saudi Arabia accounted for 72.4% of the Gulf inflation contribution. Then came the UAE with 12.1%.
Followed by Kuwait with 11.2%. The remaining percentage was distributed among Oman, Qatar and Bahrain.
Regarding Kuwait, the report indicated that the inflation rate rose from 2.1% in 2020 to 4% in 2022.
Then it gradually declined to 2.4% during 2025. This is an indication of the gradual return of price stability.
The report also indicated that the decline in global food and beverage prices by 2.1% contributed to easing inflationary pressures.
The increase in natural gas prices by 15.2% and geopolitical tensions formed pressure factors on prices during the year.
