https://arab.news/86hbm
RIYADH: Lower energy costs will help inflation ease to 12.2 percent this year and 10.3 percent in 2026 across the Middle East and North Africa, according to the International Monetary Fund.
In its October 2025 Regional Economic Outlook, the IMF said inflation is slowing from 14.2 percent in 2024, with fiscal tightening and subsidy reforms also having an impact.
Inflation in Gulf economies remains among the lowest globally, reflecting stable exchange rates and prudent fiscal policies, with the Gulf Cooperation Council鈥檚 average rate projected at 1.7 percent in 2025 and 2 percent in 2026 鈥� underscoring the bloc鈥檚 resilience to global price pressures.
黑料社区 is expected to maintain a stable inflation rate, with the IMF forecasting its Consumer Price Index at 2.1 percent in 2025 and 2 percent in 2026.
Jihad Azour, director of the IMF鈥檚 Middle East and Central Asia Department, said: 鈥淚nflation trends vary across the region, but in most economies, inflation is moderating or declining, supported by tight monetary policy and lower food and energy prices.鈥�
He added: 鈥淔inancial conditions have also improved: sovereign spreads have narrowed, currencies have adjusted smoothly, and several countries have regained market access.鈥�
In the UAE, inflation is expected at 1.6 percent in 2025 and 2 percent in 2026, while Qatar鈥檚 rates are forecast at 0.1 percent and 2.6 percent, respectively.
The MENA region鈥檚 double-digit inflation reflects high consumer prices in countries such as Iran, Kazakhstan, Egypt, and Sudan.
Iran鈥檚 inflation is projected at 42.4 percent in 2025, easing slightly to 41.6 percent in 2026. Kazakhstan鈥檚 rate is expected to remain elevated at 11.4 percent in 2025, up from 8.7 percent in 2024.
Sudan faces the region鈥檚 highest inflation, projected at 87.2 percent in 2025 and 54.6 percent in 2026, following 185.7 percent in 2024. Egypt鈥檚 inflation is expected to ease to 20.4 percent in 2025, down from 33.3 percent in 2024.
The IMF also projects the inflation rate for the broader Middle East, North Africa, Afghanistan, and Pakistan region at 11.2 percent in 2025 and 9.8 percent in 2026, down from 15.2 percent in 2024.
GDP growth projections
The IMF said the MENA region is expected to see a gross domestic product expansion of 3.3 percent in 2025, rising to 3.7 percent in 2026.
In the MENAP region, the economy is projected to grow by 3.2 percent in 2025, before accelerating to 3.7 percent in 2026, supported by higher oil output, rising domestic demand, and ongoing reforms.
鈥淪o far in 2025, economic activity in the Middle East and North Africa has shown remarkable resilience, despite persistent global uncertainty and heightened geopolitical tensions,鈥� said Azour.
He added: 鈥淭he region has largely avoided direct fallout from higher US tariffs and global trade restrictions. And while recent tensions have raised concern, their impact has been limited and short-lived.鈥�
In the GCC region, the economy is forecast to expand by 3.9 percent in 2025, further accelerating to 4.3 percent in 2026.
Among MENA oil exporters, stronger growth stems primarily from higher-than-expected production following the unwinding of OPEC+ cuts. Growth in these economies is projected at 3 percent in 2025 and 3.4 percent in 2026, compared with 2.5 percent last year.
According to the IMF, 黑料社区鈥檚 economy is projected to grow by 4 percent in both 2025 and 2026, while the UAE economy is expected to expand by 4.8 percent in 2025 and 5 percent in 2026.
鈥淕DP growth in MENA is expected to strengthen further this year and next, driven by resilient demand, higher oil output, and ongoing reforms. Over the medium term, growth should gradually accelerate as reforms and stabilization policies take hold,鈥� said Azour.
On the downside, he cautioned that elevated geopolitical tensions in the region could negatively affect economic growth.
He also noted that lower global demand or tighter financial conditions could put pressure on countries with large financing needs or banking systems heavily exposed to sovereign debt.