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Tue 23 Nov 2010 09:48 PM

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Kuwait Oct inflation slows to 5.1 % year/year

Consumer prices in the Gulf Arab state fell 0.1 percent month on month in October

Kuwait Oct inflation slows to 5.1 % year/year
Inflation in the worlds fourth largest oil exporter had been accelerating this year as the oil reliant economy recovers from last years sharp contraction (Getty Images)

Kuwait's annual inflation slowed to 5.1 percent in October from an 18 month high hit the previous month as food and housing cost pressure subsided, data showed on Tuesday.

Inflation in the world's fourth largest oil exporter had been accelerating this year as the oil reliant economy recovers from last year's sharp contraction, reaching a peak of 5.3 percent in September.

Consumer prices in the Gulf Arab state fell 0.1 percent month on month in October after September's 1.1 percent jump, state news agency KUNA said, citing statistics office data.

Food prices, which account for 18 percent of the basket, fell 0.3 percent month-on-month in October, KUNA said, after soaring 2.6 percent the previous month due to the impact of the holy month of Ramadan, when people eat more elaborate meals.

Housing prices in the OPEC member, which have the largest weight in the basket at 27 percent, were flat after rising 1.1 percent in September.

Unlike its fellow Gulf Arab oil producers, Kuwait abandoned a dollar peg in favour of a currency basket in 2007 to counter a sharp spike in inflation.

Earlier this month, Kuwait's Finance Minister Mustapha al Shamali said that inflation levels in the Gulf Arab countries were not worrying.

A Reuters poll forecast average inflation in Kuwait at 4.2 percent for the full year of 2010, up from 4.0 percent last year.