Kuwait inflation predicted to fall to 6% in 2009

ECONOMIC NOTE: NBK sees Kuwait's inflation falling to an average of six percent in 2009. (ITP Images)

Inflation in Kuwait is expected to dip to an average of about six percent in 2009 as the impact of the global slowdown continues to bite.

Inflation declined to less than 10 percent in December for the first time since the beginning of 2008, latest data from the National Bank of Kuwait (NBK) reveals.

In its latest economic brief, NBK said that inflation fell to nine percent from November's 10.4 percent, and that its average in 2009 was expected to equal six percent.

The category of housing costs fell from a high of 16.1 percent earlier in the year to 10.2 percent in November, and finally dropped to 7.5 percent in December 2008, in line with a cooler real estate and rental market, according to a report by KUNA news agency.

"The only two broad categories still above 10 percent are food and household goods and services," it added.

With December's data in, 2008 inflation averaged 10.6 percent in 2008, compared to 5.5 percent in 2007, it noted.

It said that after rising in 2007 and in the first half of 2008, inflation in Kuwait peaked at a record high of 11.6 percent in August 2008, and then started declining in the second half of the year.

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