SAUDI ARABIAN MARKET
Saudi Arabia Macroeconomic Developments
• Inflation rose to 3.4 percent in 2020, which was mainly attributed to the tripling of the value-added tax (VAT) in July. The primary drivers were food & beverages (+9 percent) and transportation (+3.8 percent). The inflation rate was 5.3 percent in December, the weakest level since the VAT increase, even as oil and petroleum-related product prices recovered.
• Point-of-sale (POS) transactions declined 21 percent to SAR8.5 billion ($2.3 billion) during the week ending January 9 after hitting a post-VAT increase high last week. The four-week averages of both the number of sales transactions and the value of spending continue to trend higher with both increasing 1.6 percent last week.
• Saudi crude exports for December totaled 6.75 million barrels per day (bpd), an increase of 650k from November, according to initial assessments by Refinitiv. In accordance with the phase-2 OPEC+ agreement, Saudi Arabia maintained its overall output at 9 million bpd. Volumes of Saudi crude to China (+100k) and Japan (+375k) increased