UAE consumer prices start easing

UAE-ConsumerUAE consumer prices started downward trend easing a bit in the month of January. Stable food prices, lower transport and communication costs kept inflation stable in UAE, the second largest economy of the Arab World.

Official data released on Thursday claims that inflation that was on its peak level in 2008 and witnessed steep decline due to global financial crisis that crippled demand across all segments of the economy. The situation was better termed deflation by the economists.

UAE's Consumer Price Index, according to the National Bureau of Statistics, declined 0.06 per cent in January. The CPI declined 0.32 per cent in January as compared to a decline of 0.42 per cent in the in the corresponding period last year.

Monica Malik, Chief Economist at EFG-Hermes expressed, "We expect inflation to return to positive territory from the second quarter of 2010, although housing prices will remain weak and are likely to see further falls."

The recent surge in the index is attributed to 0.42 percent rise in the prices of household categories which accounts for 39 percent of the consumer inflation.