The CPI index fell 1.4pc in June on an annual basis and rose 0.2pc when compared to May, data from the General Authority for Statistics showed.
"Deflation in Saudi Arabia continued to ease last month as the pick-up in activity in the non-oil sector fed through into stronger price pressures," said Jason Tuvey, senior emerging markets economist at Capital Economics.
"If oil prices stay low, as we expect, the government is likely to push ahead with fresh subsidy cuts and tax hikes, pushing inflation back into positive territory," he said in a research note.