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Tue 23 Mar 2010 02:01 PM

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UAE deflation at 0.16% year-on-year in Feb

UAE's consumer price index slips to 114.15 compared to 114.33 in February 2009.

UAE deflation at 0.16% year-on-year in Feb
INFLATION WATCH: Food prices also fell by 0.72 percent compared to January 2010.(Google Images)

Consumer prices in the United Arab Emirates declined 0.16 percent on annual basis in February, slightly less than a decrease of 0.32 percent in January, data from the National Bureau of Statistics showed on Tuesday. The consumer price index slipped to 114.15 compared to 114.33 in February 2009, which was revised from a previously reported 111.34.

The financial crisis ended an oil and real estate-fuelled boom in the Gulf Arab region, depressing consumer prices from 2008 record peaks, with some countries such as the UAE especially hard hit due to Dubai's debt problems.

On the month, prices decreased 0.17 percent in February, after falling 0.06 in January, the data showed.

The bureau said prices in the main household category, which accounts for 39 percent of the consumer inflation basket and includes rents and energy costs were down 0.32 percent compared to the previous month.

Food prices also fell by 0.72 percent compared to January 2010.

Analysts polled by Reuters in January expected average inflation of 2.5 percent this year as the economy recovers from the last year's downturn.

The ministry of economy said in February inflation is not likely to exceed 2 percent in 2010.

UAE growth is seen to be the slowest in the region due to impacts of Dubai debt restructuring. (Reuters)

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