UAE: Inflation in Dubai recedes to 14-month low in April
Inflation in Dubai dropped to 3.3% in April below March’s 4.3%. April’s result represented the lowest inflation rate since February 2022. Looking at the details of the release, the moderation chiefly reflected softer price increases for food and non-alcoholic beverages. Meanwhile, prices for transport fell by 8.5% in April, a steeped decrease than the prior month’s 1.1% one. These price developments more than offset prices for housing and utilities increasing at a brisker pace.
Accordingly, the trend pointed down slightly, with annual average inflation coming in at 5.0% in April (March: 5.2%).
Lastly, consumer prices in Dubai increased 0.21% in April over the previous month, moderating from March’s 0.26% increase. April’s result marked the weakest reading since January.
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.