Dubai residents are feeling the effects of rising prices, The National reported.
Dubai’s consumer price index rose 4.6% annually last month, the highest since 2009, amid a surge in housing and utility costs.
The Dubai Statistics Center said the consumer price index increased 0.6% month-on-month. Meanwhile, housing and utility costs, which make up about 44% of consumer expenses, soared 7.8% year-on-year and 0.7% from April, the agency said.
There is some hope however, economists say, that the UAE may have already gone through the worst of the price rises this year, as retailers typically raise prices ahead of Ramadan.
“Domestic inflation in Dubai is mainly driven by rising rents,” said Alp Eke, a senior economist at National Bank of Abu Dhabi. “With lower oil prices, foreign-origin inflation is expected to decline. The most recent housing sales and rental data indicates that rents are declining as well.”
“In my opinion, after the artificial price increase during Ramadan, inflation will be in a declining trend,” he said. “The downtrend, which is expected in the next few months, can be attributed to the appreciation of the US dollar against other currencies, the decline in oil prices and softening of property sales prices. Similarly, with lower global food costs, the contribution of food to foreign inflation will be lower.”