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Abu Dhabi inflation cools, even as housing + utilities prices rise at four-year record: Abu Dhabi’s consumer price index cooled to 0.9% in November, down from October’s reading of 1.5%, according to data (pdf) from the Abu Dhabi Statistics Center. On a monthly basis, inflation fell 0.3%, after having inched up 0.7% in October, separate data (pdf) shows, indicating that broad inflationary pressures in the capital are dissipating under the weight of falling transport prices.
Housing + utilities, furnishing lead the charge: The housing, water, electricity, and gas and other fuels segment — the heaviest-weighted component of the consumer basket — saw prices rise 3.9% y-o-y in November. Furnishing, householding equipment and routine household maintenance also inched up 5.9%. Inflation in these two categories rose at the fastest pace over the last four years. The ins. and financial services sector posted a 6.6% y-o-y increase, remaining unchanged from the previous month. While this is far below the 14.4% peak seen in April, it remains one of the fastest-growing categories in the emirate’s price index.
The clothing and footwear segment hit its lowest pace in four years, down 13.2% in November. Transport prices — the second-largest component — returned to deflation territory (-2.9%) after a brief uptick in October. Meanwhile, both education and health services prices saw no growth this year.
On a monthly basis, recreation and culture (+4.5%) recorded the highest increase, followed by a steady 0.7% m-o-m rise in housing, water, electricity, and gas costs. Clothing and footwear (-4.1%) and transport costs (-3.4%) contracted significantly, while personal care and miscellaneous goods (-0.8%), hospitality (-0.2%), and food and beverages (-0.1%) all pared back slightly.
Abu Dhabi prices remain significantly cooler than Dubai, where inflation hit 2.73% in November, easing from an October peak of 3.36% — the highest level registered this year.
The bigger picture
Earlier this month, the Central Bank of the UAE lowered its inflation forecast for this year by 0.2 percentage points to 1.3%, which it attributed to falling food and energy costs. Meanwhile, the IMF revised our inflation forecast to 1.6% in 2025 — a significant downgrade from the fund’s earlier estimate of 2.1%.
