RIYADH: Saudi Arabia’s consumer spending rose 6.8 percent year on year to SR425 billion ($113.3 billion) in the first quarter of 2026, supported by resilient demand, stable inflation and continued non-oil economic growth, Knight Frank said.
The consultancy firm’s Saudi Arabia Retail Market Overview – Summer 2026 said the increase covered point-of-sale transactions, cash withdrawals and e-commerce purchases, building on the record SR1.57 trillion spent through official payment channels in 2025, according to a statement.
Knight Frank said the Kingdom’s retail and food and beverage sectors continued to benefit from a supportive economic backdrop, with Saudi Arabia’s economy expanding 3 percent in the first quarter of 2026, driven by 2.9 percent growth in non-oil activities.
Inflation remained contained at 1.8 percent, helping sustain consumer confidence despite heightened regional geopolitical tensions.
Spending resilient
Faisal Durrani, partner and head of research for MENA at Knight Frank, said: “Consumer spending has remained resilient despite regional uncertainty, supported by sustained non-oil economic growth, stable inflation and rising household incomes.
“These factors continue to underpin retailer confidence and reinforce the Kingdom’s position as one of the region’s most attractive retail investment markets.”
Durrani explained that entertainment, wellness and community uses are becoming critical success factor determinants.
“Consumers increasingly expect destinations to offer a broader ‘day-out’ experience, combining shopping and dining with family entertainment, ‘edu-tainment’, fitness, events and social activities,” the Knight Frank partner said, adding: “This is encouraging developers to rethink the role of retail space and to place greater emphasis on destination curation, placemaking and how complementary uses work together to enhance the overall customer experience.”
Vision 2030 supports retail growth
Saudi Arabia's retail sector is also benefiting from the broader Vision 2030 transformation, which aims to attract 150 million annual visitors by 2030 and increase tourism's contribution to gross domestic product to 10 percent, supporting demand across retail, hospitality and entertainment.
The latest figures also align with the International Monetary Fund’s forecast that the Kingdom’s economy will expand 1.7 percent in 2026, before accelerating to 5.5 percent growth in 2027.
