Dubai inflation slows to 5.4% in Jan-May '09

COOL DOWN: Last month, UAE central bank governor said UAE will not face deflation. (Getty Images)

Dubai's inflation rate slowed to 5.4 percent in the first five months of 2009, compared to 8.7 percent a year earlier, the head of Dubai Statistics Center was quoted as saying on Saturday.

Rental prices for residential units had risen 3.2 percent in January to May this year, compared to a 5.4 percent increase in the same period in 2008, Arif Obaid al-Muhairi was quoted as saying in daily newspaper Al-Khaleej.

Rents in Dubai, one of seven members of the United Arab Emirates federation, have at least doubled during a building boom that came to an end late last year after the financial crisis and oil prices dropped off peaks of almost $150 a barrel last July.

Last month, the UAE's central bank governor said a rapid price fall in the country, which saw inflation drop to 1.9 percent in April, would not lead to deflation. (Reuters)

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READERS' COMMENTS

good sign
Posted by AJAY JHA, DUBAI, UAE on Monday 6 July 2009 at 21:48 UAE time


Excellent and totally accepted...Sheikh Abdullah bin taleh

GOOD SIGN
Posted by AJAY JHA, DUBAI, UAE on Saturday 4 July 2009 at 22:32 UAE time


In general words inflation is the increase in the prices of goods and services over the period of time. Inflation causes very adverse effects on our economy as people starts to disinvest and starts saving which results in less flow of money in the market and the prices of goods starts to shoot up.

It is good that the level of inflation in coming down . People have more money with them that means they have more purchasing power.
In economics we have read that inflation is not as bad as deflation is that is when the inflation index will become negative. That kind of situation is very harmful for an economy as if will lead to low output by the producer sector which will result in low income and therefore will lead to unemployment.

I just want to say that it is good that inflation has gone down but it is not going to decrease the prices of commodities And it should not become negative.

AJAY JHA
ROYAL BANK OF SCOTLAND
DUBAI

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