RIYADH: Oman’s inflation rate saw a modest 0.8 percent increase in October compared to the same month last year despite price increases across several categories, according to an official report.  

The National Center for Statistics and Information analysis revealed that consumer prices for miscellaneous goods and services increased by 4.8 percent year on year, followed by food and non-alcoholic beverages by 3.5 percent, healthcare by 3.2 percent, and culture and recreation by 0.8 percent.  

Restaurants and hotels also saw gains of 0.6 percent, clothing and footwear by 0.5 percent, household furniture and maintenance by 0.4 percent, and education by 0.1 percent.  

Conversely, transportation prices declined by 2.6 percent, while housing, utilities, fuel, communication, and tobacco categories remained stable.  

Breaking down the food and beverage category, vegetable prices recorded the largest increase at 8.9 percent. Fruits followed with an 8 percent rise. Dairy products, including milk, cheese, and eggs, increased by 5.4 percent. Oils and fats rose by 3.8 percent, while meat prices climbed by 2.8 percent. Sugar and confectionery saw a 2.4 percent increase. 

Processed foods increased by 1.8 percent, bread and cereals by 0.8 percent, and non-alcoholic beverages by 0.7 percent. Meanwhile, fish and seafood prices fell by 1.2 percent, partially offsetting the broader price hikes in food items.  

Broad money supply  

Data by the nation’s central bank pointed to a significant expansion in Oman’s broad money supply, which grew by 13.9 percent year on year, reaching 24.7 billion Omani rials ($64.1 billion) by the end of September.  

This growth was driven by an 18.2 percent increase in narrow money and a 12.3 percent rise in quasi-money, which includes savings deposits, term deposits in Omani rials, and certificates of deposit issued by banks, as well as margin accounts, and foreign currency holdings within the banking sector.  

Despite the overall monetary expansion, cash held by the public declined by 6.7 percent, while demand deposits surged by 25.1 percent, reflecting changing preferences in liquidity management.  

Commercial banks in Oman recorded rising interest rates during the period. The weighted average interest rate on Omani rial-denominated deposits increased from 2.453 percent in September 2023 to 2.679 percent in September this year.  

Similarly, the weighted average interest rate on loans denominated in Omani rials rose from 5.451 percent to 5.604 percent over the same period.  

Interbank lending rates for overnight transactions declined slightly, with the average falling to 4.896 percent in September compared to 5.388 percent in the same month last year.  

This shift aligns with the reduction in the weighted average repurchase rate, which decreased from 6.000 percent to 5.790 percent during the same timeframe. These movements are attributed to adjustments in monetary policy in line with the US Federal Reserve’s actions.