Dubai inflation accelerated to 0.8% in June on food prices

Record global food prices are likely to be sustained this year due to high crude oil costs and smaller crops
Dubai inflation accelerated to 0.8% in June on food prices
Dubai inflation accelerated in June, led by increases in food and transportation costs (Getty Images)
By Bloomberg
Wed 06 Jul 2011 04:23 PM

Dubai inflation accelerated in June, led by increases in food and transportation costs.

The inflation rate rose to 0.8 percent, the Dubai
Statistics Center said in an e-mailed statement on Wednesday. Food prices
increased 6.7 percent while transportation costs rose 6.6 percent, the
report said. In the month, prices increased 0.5 percent.

“Across the
GCC, food prices are the major inflationary driver, with the exception
of Saudi Arabia which is also seeing strong housing inflation,” Monica
Malik, Dubai-based chief economist at
EFG-Hermes UAE Ltd, said in a telephone interview.

“We expect to see
government measures to limit food price rises increasing in the run-up
to the holy month of Ramadan, when prices normally strengthen across the
region.”

Record
global food prices are likely to be sustained this year because of high
crude oil costs and smaller crops, the United Nations Food &
Agriculture Organization said in March. Crude prices rose 15 percent
last year and are up 6 percent this year.

The month long Islamic holiday of Ramadan, when Muslims fast from sunrise to sunset, begins in early August.

The Gulf Cooperation Council comprises Kuwait, Saudi Arabia, the United Arab Emirates, Oman, Qatar and Bahrain.

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