* Sept inflation rises from 4.8 pct y/y in Aug
* Consumer prices up 0.9 pct m/m in Sept, 0.5 pct in Aug
* For details click on:
* For exclusive with Saudi c.bank gov:
(Adds quotes, details, background)
By Asma Alsharif and Martina Fuchs
JEDDAH, Saudi Arabia/DUBAI, Oct 16 Saudi
Arabia's annual inflation rose to an eight-month high of 5.3
percent in September, boosted by price rises of miscellaneous
products and services, while monthly price growth almost
doubled, data showed on Sunday .
Inflation in the biggest Arab economy and world's
top oil exporter had hovered below 5 percent for most of 2011.
It was 4.8 percent on an annual basis and 0.5 percent
month-on-month in August.
Last month's annual consumer price growth of 5.3 percent was
the highest since January, while month-on-month inflation was
0.9 percent, Central Department of Statistics data showed.
"External pressures might have had some effect but this is
mostly about domestic demand," said Simon Williams, chief
economist for the Middle East and North Africa at HSBC.
"Public spending is rising faster than elsewhere and credit
growth is recovering more strongly. We continue to look for an
end-year reading of around 6 percent."
Analysts had expected consumer prices to gain momentum this
year after the government pledged early in 2011 to spend an
estimated $130 billion, or nearly 30 percent of annual economic
output, on housing, job creation and other measures to improve
social welfare over an unspecified period.
"Always in the second half of the year, which includes
summer vacations, Ramadan, religious holidays and restarting of
the schools, these factors result in increased spending and
prices," said Abdulhamid Al-Amri, member of the Saudi Economic
Association think tank.
"I expect that from now until the end of the year the prices
will continue rising."
A Reuters poll of analysts in September forecast average
inflation of 5.1 percent in 2011, slightly down from 5.3 percent
Food costs, which account for 26 percent of Saudi consumer
expenses, increased 0.4 percent month-on-month in September
after a 1.5 percent jump in August, the data showed.
Housing and utility prices, making up 18 percent of the
consumer basket, rose 0.6 percent after a 0.7 percent climb in
August. The products and services component saw a 3.9 percent
spike in September.
The International Monetary Fund said in August that the
kingdom, which pegs its riyal currency to the U.S. dollar,
needed to keep a close eye on inflationary pressure following
the planned increase in social spending.
But in a Reuters interview on Saturday, central bank
Governor Muhammad al-Jasser said interest rate settings were
appropriate at the moment with no signs of inflation coming from
Jasser said earlier this month that he was "not worried"
about inflation levels and expected them to continue to decline.
Saudi Arabia's economy is forecast to expand 6.2 percent in
2011 following 4.2 percent growth in 2010, helped by robust
crude oil prices and generous government spending, according to
the analysts polled by Reuters last month. Growth is expected to
slow to 4.5 percent next year, partly because of a weakening of
the global economy.
(Reporting by Asma Alsharif and Martina Fuchs; Editing by