Fitch Solutions expects consumer spending in Kuwait to be moderate & stable this year

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KUWAIT CITY, Feb 23: Fitch Solutions, a credit rating agency, expects consumer spending in Kuwait to achieve moderate and stable growth of 4.4% in 2023 suggesting that total consumer spending (in nominal terms) in Kuwait would reach 20.6 billion dinars in 2023, up from 19.2 billion dinars in 2022, expecting that Kuwait’s GDP growth would reach 2.7% in 2023 and 5.1% in 2024, and the percentage of inflation 3% in 2023 and 2.2% in 2024, reports Al-Qabas daily.

The agency noted in a report that its expectations for the growth of consumer spending in Kuwait for the current year support its expectations of postponing the introduction of the value-added tax until 2024, amid concerns about inflation and political problems, noting that the risk team in the agency believes that oil prices will remain strong in 2023 and will support public and private sector spending in Kuwait over the next 12 to 14 months.

Retail transactions were recorded in the last quarter of 2022 at $4.2 billion, compared to 3.7 billion dinars in the first quarter of 2021, confirming high oil prices and the delay in introducing the value-added tax will further support consumer spending growth in 2023. Fitch stated that the latest retail trade data in Kuwait indicates strong growth in consumer spending.

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