Wednesday 07 / January / 2026
Muscat: The Ministry of Economy has confirmed that the inflation trajectory in the Sultanate of Oman throughout 2025 aligned with projections, which estimated a rate of approximately 1 percent. The average inflation in the Consumer Price Index (CPI) recorded 0.94 percent from January to November of last year.
The Ministry noted that on a local level, inflation continues its moderate path within target ranges. Global inflationary pressures remain relatively limited despite variables in international trade policies and rising customs duties, which still cast a shadow of uncertainty and raise concerns about future inflation.
The Ministry emphasised that the moderation of inflation in Oman over the years of the Tenth Five-Year Plan (2021–2025) resulted from the government's adoption of proactive policies. These measures, aimed at containing global inflation since 2021, included targeted support for food commodities and basic services, which mitigated the impact of global price surges on local markets and protected national economic growth and purchasing power.
Maintaining a moderate inflation rate has served as a catalyst for economic growth, particularly as the Central Bank of Oman (CBO) shifted toward monetary easing. Following the US Federal Reserve's decisions and Oman’s policy of linking the Omani Rial to the US Dollar, the CBO lowered interest rates on repo operations multiple times in 2025, dropping from 5 percent at the end of 2024 to 4.25 percent by December 2025.
This easing has enhanced local liquidity and reduced credit costs for the private sector. Key banking data for 2025 shows that total credit granted by the banking sector reached OMR34.7 billion by the end of October 2025, a growth of 9.0 percent. Credit granted to the private sector rose by 5.8 percent to reach OMR28.3 billion.
The Ministry highlighted that facilitating lending is a strategic enabler to empower the private sector as a partner in sustainable development and an engine for growth under Oman Vision 2040.
The Ministry detailed various price shifts within the CPI from January to November 2025 as food and non-alcoholic beverages fell by 0.33 percent. Groups such as housing, water, electricity, and telecommunications remained stable.
Miscellaneous goods and services rose by 6.8 percent, transport by 3.2 percent, restaurants and hotels by 1.8 percent, and health by 1.5 percent. Clothing and education saw minor increases of approximately 0.45 percent.
Al Dakhiliyah Governorate recorded the highest inflation at 1.63 percent, followed by Al Dhahirah (1.54 percent) and Musandam (1.21 percent).
North Al Sharqiyah recorded the lowest inflation rate in Oman at 0.29 percent.
The general Producer Price Index (PPI) decreased by 4.3 percent by the end of the third quarter of 2025 compared to the same period in 2024, driven by a decline in mining, quarrying, and manufacturing prices. Conversely, the Import Price Index rose by 15.2 percent, impacted by a 34.7 percent surge in beverages and tobacco and a 12.1 percent rise in machinery and transport equipment.
Global commodity prices are expected to continue declining into 2026, reaching their lowest levels in six years. The FAO Food Price Index also dropped for the third consecutive month in November 2025, remaining nearly 22 percent below the peak recorded in March 2022.
