United Arab Emirates: Inflation in Dubai recedes to seven-month low in October

Inflation in Dubai eased for a third consecutive month in October; it moderated to a seven-month low of 4.5%, down from September’s 5.4%. Looking at the details of the release, the softening was chiefly due to milder price increases for food and beverages. Price increases for transport moderated sharply in October. These more than offset a brisker increase in prices for housing and utilities.

Meanwhile, consumer prices in Dubai fell 0.15% in October over the prior month, a smaller decrease than the previous month’s 0.62%.

While detailed monthly data for the UAE has not been published since December 2021, average inflation accelerated to 6.8% in April–June 2022 (Q1 2022: 3.4%), chiefly due to stronger increases in prices for food and beverages, and transportation. Price developments in Dubai for July–September suggest headline inflation in the UAE should have receded in the third quarter and further at the outset of the fourth quarter.

FocusEconomics Consensus Forecast participants expect inflation in the UAE to average 3.1% on average in 2023, which is up 0.2 percentage points from last month’s forecast. For 2024, they see inflation averaging 2.3%.