Don't miss

Replay


LATEST SHOWS

FASHION

Behind the scenes of haute couture: Taking time to create something unique

Read more

BUSINESS DAILY

Europe's Final Countdown: 48 hours before Greek referendum

Read more

FRANCE IN FOCUS

Guadeloupe: The story behind France’s butterfly island

Read more

REVISITED

Racial tensions linger in LA, city of Rodney King riots

Read more

IN THE PAPERS

Hillary Clinton: Loves ice tea, doesn't know how to use a fax machine

Read more

IN THE PAPERS

Is a 'Grexit' something to be afraid of?

Read more

MEDIAWATCH

Egypt cracks down on media

Read more

MEDIAWATCH

'Hands off Les Guignols'

Read more

THE DEBATE

Egypt at daggers drawn (part 2)

Read more

UAE housing market feeds spiralling inflation

Latest update : 2008-06-14

Inflation in the oil-rich United Arab Emirates, where the consumer prices index has sharply increased over the past few years, hit 10.9 percent in 2007, an official study said, pointing to the surging cost of house rentals.

Consumer prices in Abu Dhabi, the wealthiest of seven emirates forming the UAE, increased by 11.5 percent in the first quarter of 2008 from 10.7 percent a year earlier, Abu Dhabi's Department of Planning and Economy said.

The study blamed the increase in UAE and Abu Dhabi inflation mainly on the surging cost of house rentals, the official news agency WAM said.

It slammed a UAE central bank policy of copying decisions taken by the US Federal Reserve reducing interest rates instead of tightening the monetary policy in the robust UAE economy. The dirham is pegged to the dollar.

"It is unreasonable that local interest rates would increase or decrease for external reasons, most importantly the policies of the US Federal Reserve, when the indices of the UAE economy imply that the opposite is needed," WAM quoted the study as saying.

The last official inflation figures provided by the ministry of economy pertain to 2006 putting it at 9.3 percent. Inflation figures for 2005 were not provided, but the International Monetary Fund put it at 7.8 percent.

The UAE sits on 97.8 billion barrels of oil reserves, which are ranked as the fifth largest in the world. Its economy is estimated to have grown by 7.4 percent in 2007, according to the IMF.

Date created : 2008-06-14

COMMENT(S)