Inflation in Gulf Countries: Among the Lowest Globally

Data from the Gulf Cooperation Council (GCC) Statistical Center showed continued price stability in GCC member states, with the general inflation rate holding at 1.8% in 2025, compared to 1.6% in 2024, remaining below the 2% threshold for the second consecutive year.

In a report on inflation rates in the GCC countries for 2025, the Center stated that this stability “is an indicator reflecting the success of economic policies in containing inflationary pressures and maintaining price stability.” It added that the GCC inflation rate is among the lowest globally, falling below the 5.3% rate in emerging and developing economies, the global average of 4.2%, Japan’s 3.2%, the United States’ 2.6%, the 2.5% rate in the European Union and advanced economies, and the 2.1% rate in the Eurozone.

The Center noted that inflation rates among GCC member states were closely aligned. It highlighted that the housing and diverse goods and services groups were the main drivers of GCC inflation in 2025, jointly contributing approximately 73% to the overall inflation rate.

Regarding the main groups comprising the Consumer Price Index in GCC countries, the Center pointed out that the diverse goods and services group led inflation at 5.4%, followed by the housing group at 4%, the culture and entertainment group at 2%, and the restaurants and hotels group at 1.6%.

It noted that these were followed by the food and beverages group at 1.2%, the education group at 1%, the tobacco group at 0.6%, and the clothing and footwear group at 0.4%. Meanwhile, the health, communications, and furniture groups remained stable at zero percent, while the transport group recorded a decline of 0.2%.

The Center reviewed the evolution of GCC inflation from 2020 to 2025, noting that it rose from 1.5% in 2020 to 2.4% in 2021, peaked at 3.2% in 2022, then declined to 2.3% in 2023 and 1.6% in 2024, before rising slightly to 1.8% in 2025, reflecting relative stability compared to global developments.

Regarding the GCC’s main trading partners, the Center stated that inflation rates ranked from highest to lowest were: Brazil at 5%, the United Kingdom at 3.9%, Japan at 3.2%, India at 2.8%, and the United States at 2.6%.

The Center highlighted that a global 2.1% decline in food and beverage prices helped alleviate imported inflationary pressures, but a 15.2% rise in natural gas prices and geopolitical tensions “remain risks requiring monitoring.”

The Center concluded in its report that the significant convergence and stability of inflation rates among GCC member states below the 2% level provide a favorable foundation for enhancing GCC economic and monetary integration. It clarified that this gives countries fiscal space to continue economic reforms and development spending, while emphasizing the importance of harmonizing statistical methodologies and strengthening policy readiness to address any future external pressures.

It is worth noting that the GCC Statistical Center, headquartered in the Sultanate of Oman, was established in 2011 to serve as the official body authorized to provide data, information, and statistics related to the GCC countries, in addition to its role in enhancing statistical and informational work among national statistical centers and planning authorities within the region.