Saudi Arabia lifts 2026 budget deficit forecast to 4.9% of GDP, cuts GDP outlook to 3.6% contraction

Saudi Arabia widened its 2026 budget deficit projection to 4.9% of GDP from 3.3%, with spending rising to ~1.4 trillion riyals on defense, infrastructure and diversification. GDP forecast was slashed from 4.6% growth to a 3.6% contraction, driven by weaker oil activity amid the US-Iran war.