UAE inflation at five-year high

Housing and utility costs, which carry a weighting of more than 39 per cent on the index, were up by 2.6 per cent during the month compared to a year earlier.

Inflation in the UAE rose to its highest in five years last month, nudged up by costlier housing and food costs.

The consumer price index reached 2.1 per cent, up from 1.9 per cent the previous month, showed data released yesterday by the National Bureau of Statistics. Compared to the previous month, prices rose by 0.3 per cent.

Housing and utility costs, which carry a weighting of more than 39 per cent on the index, were up by 2.6 per cent during the month compared to a year earlier.

The data provides further evidence of the run-up in residential rents as the property market rebounds. Recent figures have so far shown little sign of an easing in rental inflationary pressures, despite research showing the rate of property price rises in Dubai has cooled.

The national housing index has accelerated at a faster rate in each of the first four months of the year. Separate research by Cluttons, the property services company, showed residential prices rose by 3 per cent in the first quarter of the year, down from 6 per cent growth in the fourth quarter of last year.

Other components of the consumer price index also edged higher last month. Food and soft drinks, which account for almost 14 per cent of consumer expenses, rose 2.4 per cent from a year earlier. Furniture and household goods climbed 4.5 per cent, while education costs rose 4.6 per cent.

tarnold@thenational.ae

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Published: May 27, 2014 04:00 AM

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