Economic Research

In-depth reports on key economic issues.

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    Sun, 25 December 2016

    Saudi Arabia's 2017 Fiscal Budget

    The government’s budget for the 2017 fiscal year (31 December 2016 to 30 December 2017) was endorsed by the Council of Ministers on 22nd December. It points to an expansionary stance and is also in line with the National Transformation Program’s (NTP) target of reaching a balanced budget by 2020.

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    Thu, 15 December 2016

    Monetary and financial update: (Rebound in monetary aggregates)

    In December 14, 2016, the Saudi Arabian Monetary Authority (SAMA) increased its reverse repo policy rate by 25bps to 0.75 percent, its second such increase since 2008, mirroring the hikes in the US. Meanwhile, SAMA’s key policy repo rate was kept unchanged at 2.0 percent. SAMA’s rate increase and the prospect of further Fed hikes in 2017 will not have a significant impact on the domestic liquidity situation. This is specifically due to SAMA recently passing several measures to enhance liquidity in the domestic financial system.

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    Tue, 13 December 2016

    Saudi labor market update- Q3 2016

    The Saudi labor market continued to point to a high degree of segmentation in Q3 2016, particularly in the employment trends between Saudis and non-Saudis. This has resulted in the Saudi unemployment rate rising despite the economy creating a near record number of job. 

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    Sun, 04 December 2016

    Oil Note: OPEC Announces Production Cuts

    OPEC agreed to cut its own production by 1.2 million barrels per day (mbpd), to 32.5 mbpd, on 30th of November. Oil prices immediately rose by 8 percent following the announcement and could rise even further in the short term. Whether prices remain elevated will depend on OPEC implementing its agreement with discipline as well as no major rises in US shale oil supply. Overall, whilst the OPEC cuts represent an up-side risk to oil prices, due to the hurdles mentioned above, we are not revising our current forecasts just yet, but will be monitoring developments closely.

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    Thu, 24 November 2016

    Macroeconomic update- November 2016: (Reform of the Saudi economy begins to take shape)

    Since the start of 2016, and in line with targets specified in the National Transformation Program (NTP 2020), prudent policies to reform the fiscal budget have been taken, with their impact on economic performance starting to take shape. We have therefore revised some of our 2016 and 2017 forecasts to take into account this recent set of reforms.

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