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Sat 15 Oct 2016 12:11 AM

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UAE inflation falls sharply in August amid fuel price slump

Big drop in transport costs drive inflation rate down to 0.6% from 4.9% in August 2015

UAE inflation falls sharply in August amid fuel price slump

The UAE's inflation rate fell sharply on an annual basis to 0.6 percent in August, according to the UAE National Bureau of Statistics.

The year-on-year rate dropped from 1.8 percent the previous month and was down from 4.9 percent in the year-earlier period.

The figures, cited by Reuters, showed that housing and utility costs, which account for over 39 percent of consumer expenses, rose 2.7 percent from a year earlier.

Food and soft drink prices, which account for nearly 14 percent, climbed 1.7 percent but transport costs plunged 12.1 percent after the UAE cut domestic fuel prices for August.

The fall in inflation comes as a new Bayt.com and YouGov survey revealed that the majority of UAE respondents (68 percent) expect the cost of living to increase in the next six months, with only 8 percent expecting it to decrease.

When asked about the situation of their current savings compared to last year’s, only 16 percent of UAE respondents claim that their savings have increased, with 46 percent seeing a decrease.

In August, a survey from investment company National Bonds Corporation revealed that the rising cost of housing, bills and education had the biggest impact on UAE residents’ ability to save.

Nearly seven in ten (64 percent) of respondents said accommodation costs ate up most of their budget, while 46 percent said increasing utility costs as their biggest worry. Meanwhile, 45 percent cited rising school fees as their biggest concern.

In Abu Dhabi, 51 private schools have just been granted permission to increase their fees by an average of six percent for the 2016-2017 academic year.