UAE inflation falls for first time in six months
UAE inflation slowed in November for the first time since April as food costs fell, data from the UAE’s National Bureau of Statistics showed yesterday.
Annualised inflation dipped from 3.11 per cent to 2.82 per cent – the first decrease for six months.
Clothing and textiles inflation recorded the biggest month-on-month decrease, falling by 1.6 per cent. Food and soft drink inflation fell by 1.43 per cent.
The prices of 500 staple food products would be frozen across 2015, the government announced at the end of November. Clothing and food account for about 20 per cent of the UAE’s consumer price inflation basket.
Housing costs rose at an annual rate of 4.35 per cent in November, up from 4.17 per cent in October, while furniture and household goods increased by 4.71 per cent – up from 4.57 per cent last month. Housing cost inflation has outstripped the national rate of inflation continuously this year.
It is the highest rate of increase since the 2009 real estate crash – but experts believe that the national statistics lag actual housing market trends by several months. A range of government measures, including restrictions on mortgages and off-plan sales, and increases in transaction fees were implemented this year in a bid to slow house price growth.
According to figures available from the real estate consultancies Cluttons and JLL, average Dubai freehold rents fell 0.4 per cent in the three months to September, while Abu Dhabi rents remained constant in the third quarter.
Abu Dhabi commercial rents rose by 6 per cent in the third quarter, while the outlook for Dubai commercial rents remained variable, with prime office space set to increase in price and outlying commercial properties set to charge lower rents.
Meanwhile, monthly figures from Dubai showed inflation in the emirate slowing to an annualised 4.15 per cent in November, down from 4.38 per cent the previous month. Abu Dhabi registered annualised price increases of 3.7 per cent in November.
UAE inflation is expected to average 2.5 per cent in 2014, according to a Reuters poll of economists in September, before increasing to 3 per cent in 2015. The IMF expects inflation of 2.2 per cent this year, and 2.5 per cent next year.
The average inflation rate in 2014 up to December was 2.3 per cent.
Published: December 28, 2014 04:00 AM