* Lowest inflation since last September
* Month-on-month rate flat at 0.2 pct
* Housing prices jump 8.8 pct, food 4.7 pct
* Weak euro may have had impact
By Asma Alsharif
JEDDAH, Saudi Arabia, July 10 Saudi Arabia's
annual inflation eased to 4.9 percent in June, its lowest level
since September last year, despite a big rise in housing prices,
official data showed on Tuesday.
Inflation slowed from 5.1 percent in May. The month-on-month
rate in June was unchanged from 0.2 percent in May, according to
the Central Department of Statistics.
"I think it is probably lower commodity prices globally and
a reflection of a strong dollar and a weaker euro, because about
28 percent of Saudi imports are from Europe and that makes a
difference," said James Reeve, senior economist at Samba
Financial Group. Saudi Arabia pegs its riyal currency to
Prices of housing, rents and water jumped 8.8 percent from a
year earlier in June. Saudi Arabia suffers from a housing
shortage that drives up real estate prices; last year the
government promised to build half a million new homes and last
week it passed a mortgage law designed to stimulate house
building, but analysts believe high land prices may prevent any
quick resolution to the problem.
Other price categories were relatively subdued; food prices,
which account for 26 percent of Saudi consumer expenses, climbed
4.7 percent in June and clothing gained 2.9 percent.