Deflation arrives to United Arab Emirates. First time since 1990.

Deflationary pressures are being felt throughout the world from Japan to USA to Europe and to the Middle East. No one is going to escape the disciplining force of deflation. July 28, 2009.

UAE posts its first deflation since 1990.

(MENAFN) UAE’s Ministry of Economy said that the country’s annual inflation rate has turned negative for the first time since almost two decades, Khaleej Times reported.

The Ministry said that prices of essential consumer goods and services declined by 0.03 percent in June compared to the same month a year earlier; however, The negative inflation, or deflation, would bring a welcome relief to consumers.

Data showed that a nationwide plunge in housing rents and a drop in food prices were the main contributors to the overall decline.

In the first six months of this year, UAE’s consumer price index dropped by 2.7 percent, due to a 5.8 percent fall in housing costs and a 2 percent decline in food prices. It is worth noting that housing rents and food prices account for more than 50 percent of the consumer price index basket.

The country’s inflation reached a 20-year high of 12.3 percent in 2008, after reaching 11.1 percent in 2007.


Post a Comment

%d bloggers like this: