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Abu Dhabi’s consumer price index was up 0.1% in July, breaking a three-month downward streak, according to data from the Abu Dhabi Statistics Center. On a monthly basis, inflation saw a 0.9% increase, according to the data, after having edged down 0.5% in June.
Prices of ins. and financial services saw the highest annual increase in July, climbing 6.8%. This was followed by 2.9% increases in the costs across the board in the restaurants and hotels; as well as furnishing, household equipment and routine household maintenance; and housing, water, electricity, gas and other fuels.
Some sectors are still in deflation territory: Clothing and footwear recorded the most significant deflation during the month, dipping 6.9%, followed by a 5.8% decline in transport prices — the second largest component in the inflation basket — and a 1.1% drop in food and beverage costs. The communications segment also saw a 0.3% drop.
On a monthly basis, furnishing, household equipment and routine household maintenance recorded the highest increase among all categories during the month, rising 3.7%, followed closely by a 3.6% increase in transport prices, and a 2.2% rise in recreation and culture costs. Segments seeing deflation included clothing and footwear, dipping 2.1%; food and beverage, down 0.4%; and restaurants and hotels, which saw prices fall 0.2%.
Price growth is still cooler than in Dubai: Dubai’s annual inflation accelerated to 2.88% in July, up from 2.37% in June. Some components of the basket recorded moderate price growth, while other segments remained in deflation territory.
The bigger picture: In June, the Central Bank of the UAE (CBUAE) slightly lowered its inflation forecast for the UAE this year by a 0.1 of a percentage point to 1.9%, which it attributed to a “continuous downward trend in transportation costs” and “moderating energy prices.” This puts the CBUAE’s forecast just below that of the IMF, which now expects inflation in the UAE to come in at 2.1% in 2025, in what is a slight upward revision from the fund’s earlier estimate of 2% inflation for the year.
