The UAE's CPI inflation rose 1.3% y/y in August, the same as a month earlier, on lower food prices which offset rising transport and tobacco and alcohol costs, data from the statistics office showed. The UAE’s CPI inflation remains largely subdued by stagnating housing costs, which account for 39% of the index. Housing prices edged up 0.4% y/y in August, the same as the month before. The government has also set strict price regulations for basic food commodities, hoping to keep the CPI anchored. In monthly terms, the CPI rose 0.3% m/m in August compared with zero growth a month earlier.
Food and non-alcoholic beverages charges (14% of the basket) rose 1.6% m/m in August on higher fresh produce prices but the annual growth eased to 3.1% y/y from 3.5% in July. Transport prices grew 0.4% m/m in August, lifting the annual increase to 1.2% y/y from 0.9% in July. Tobacco and alcohol charges climbed 17.3% y/y in August, the same as a month earlier. Clothing and footwear prices edged up 0.2% m/m in August, sending the annual growth to 0.8% y/y from 0.7% in July.
The UAE’s CPI inflation will accelerate to 1.6% in 2013 from 0.7% the year before, the IMF said in its latest April WEO.
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