Inflation
in Oman Averaged 1.4 pc During 2021-2024

Muscat, 5 Mar (ONA) — The average rate of the Sultanate of
Oman’s actual inflation from 2021 to the end of 2024 stood at about 1.4 percent.
It rested at a moderate rate and within the 2.8 percent target set for the
years of the tenth five-year development plan 2021-2025.

The Omani economy continues to grow at rates exceeding the
inflation average. The actual average growth of the Gross Domestic Product (GDP)
at constant prices stood at 3.9 percent between 2021 and 2023.

The budget for the current fiscal year (2025) saw the
augmentation of the volume of public spending and the consolidation of the clause
of contributions and other expenditures. In the same budget, public spending
was estimated at about RO 11.800 billion, compared to RO 11.650 billion in
2024.

The current budget included allocations for the social
protection scheme to the tune of about RO 577 million, while a sum of RO 73
million was allocated to subsidize the interests of “development and housing
loans”, RO 520 million to support the electricity sector, RO 194 million to
support the water and wastewater sector and RO 216 million to support petroleum
products, food commodities, the transport sector and the waste sector and other
sectors.

In terms of the monetary policy of the Sultanate of Oman, with
Omani Rial being pegged to US Dollar, the Central Bank of Oman (CBO) has been
keen on keeping pace with the decisions of the US Federal Reserve—in view of bank
interest rates. The overall aim is to strike a balance between supply and
demand for liquidity and to limit the rise in the inflation rate.

In line with a trend towards monetary easing after the
decline in the inflation rate, the CBO cut down the interest rate on repurchase
operations for local banks during 2024, thus bringing the interest rate to 5.00
percent by the end of 2024.

The Ministry of Economy explained that the annual inflation
data indicates a continued decline in the inflation rate according to the
consumer price index in the Sultanate of Oman. The average of annual inflation stood
at about 0.60 percent during the period from January to December 2024, compared
to about 0.94 percent during the corresponding period in 2023.

— Ends/Bishara/AG