UAE: Inflation cools to a one-year low in March
Inflation in Dubai receded to 4.3% in March, down from February’s 4.9%. March’s reading was the lowest reading since March last year. Looking at the details of the release, the moderation was chiefly due to prices for food and non-alcoholic beverages rising at a slower rate. Additionally, prices for transport fell in March. These price developments more than offset prices for housing and utilities increasing at a brisker pace.
Still, the trend pointe dup slightly; annual average inflation ticked up to 5.2% in March (February: 5.1%).
Lastly, consumer prices in Dubai rose 0.26% over the prior month in March, slowing from the 0.77% increase tallied in February.
Meanwhile, data for the UAE as a whole is not available past Q2 2022, when inflation accelerated to 6.8% (Q1 2022: 3.4%). That said, in line with price developments in Dubai, price pressures in the UAE should have peaked in Q3 2022 and then eased at the end of the year. Moreover, our panelists believe the downward trend should continue in coming quarters as interest rates rise further and external price pressures dim.