Dubai inflation rises to 5.5% as transport costs force Emirates NBD to lift year-end forecast

Dubai inflation is climbing again — and Emirates NBD has nearly doubled its year-end call: Consumer prices rose 5.54% y-o-y in August, up from 5.3% in July, while monthly inflation accelerated to 0.31% from 0.1%, according to the latest data (pdf) from the Dubai Data and Statistics Establishment. Emirates NBD Research has raised its year-end inflation forecast to 5.6% from 2.9% earlier this summer, citing a longer-than-expected stretch of elevated oil prices.

Transport put its foot back on the accelerator: Prices in the category climbed 12.7% y-o-y, with fuel and lubricants up 31.3% and passenger airfares 23.2% higher. Fuel prices also rose 5.4% m-o-m, after the UAE Fuel Price Committee hiked prices following a cut in July, although airfares fell 9.8% from July.

Housing is still seeing prices rise. Housing, utilities, and fuel prices rose 6.7% y-o-y as residential rents continued to climb across much of Dubai, while food and beverages were up 7.4%, according to the statistics authority. Emirates NBD says housing remains the largest contributor to headline inflation, even as price growth in the category has slowed from earlier in the year.

The bigger change is how long Emirates NBD thinks the pressure will last. We reported in July that the bank thought inflation had peaked at 5.7% in June and would fall to 2.9% by year-end. July initially supported that view, although Emirates NBD warned that higher August petrol prices could produce a rebound. Pump prices then rose again in September, extending the energy pressure and prompting the bank to push its year-end call up to 5.6%.

So the disinflation story has been delayed, not derailed: August inflation remains below June’s 5.7% peak, but Emirates NBD now expects headline price growth to stay elevated through the rest of 2026 before easing in 2027.