UAE came in as the third lowest country in the world in terms of inflation rates during the first quarter of 2022.
According to data from the Federal Competitiveness and Statistics Center, the rate of consumer price inflation in UAE during the first quarter of this year was about 3.35%.
Thus, the general record rose to 102.70 points during the period from January to March 2022, compared to about 99.37 points in the same period in 2021.
The rise in the inflation rate during the first quarter was driven by the rise of a number of major groups, led by the transportation group, which constitutes about 12.7% of the index’s weight (according to the adoption of basket weights for 2019).
The transportation group increased by 22%, to 111.31 points, compared to 91.24 points in the same quarter of 2021.
It was followed by the food and beverage group, which constituted about 12.9% of the index’s weight, recording an increase of 5.4%, to reach 103.98 points, compared to 98.66 points.
Restaurants and hotels, which constitute 4.6% of the weight, recorded an increase of 6.87%, and communications, which constitute 5.9% of the weight, increased by 2.26%.
Then came clothes and shoes, which constitute about 5.2% of the weight, recording an increase of 2.7%, and tobacco, which constituted about 0.2%, with an increase of 4.07%.
Furniture, furnishings, sanitary and household appliances and repairs (5.1% of the weight) increased by 2.10%.
The rest of the ascending groups, which make up the consumer price index, recorded further increases, ranging between 0.87% and 1.99%.
Only two groups recorded a significant decrease in consumer prices, housing, water, electricity and domestic gas, which constitute about 5.1% of the weight.
Each recorded a decrease of 2% to 99.38 points, compared to 101.4 points in the first quarter of last year.
It was followed by the insurance and financial services group (constituting 1.3% of the weight), recording a decrease of 1.72%, to reach 101.79 points, compared to 103.56 points in the same period last year.
The International Monetary Fund expected the inflation rate to be 3.7% this year and to drop next year 2023 to reach 2.8%.
UAE is the third best
According to the Competitiveness Yearbook for 2022, issued by the International Institute for Management Development in Switzerland, UAE ranked third in the world in stable inflation rates.
The latest forecasts of the International Monetary Fund indicate that the inflation rate in UAE will reach 3.7% this year, and then decline next year to 2.8%, to remain among the lowest inflation rates in the world.
Emirates Bank Forecasts
The Central Bank of Emirates also expects that the average overall inflation in the consumer price index for 2022 will range between 2 and 3%, or about (2.5%), compared to 3.3% in the first quarter of the year.
The bank explained that the main drivers of inflation will be a rise in energy prices and imported inflation, which are expected to reach record levels globally, in addition to the increase in wages and the continuous decline in rents.
The Federal Competitiveness and Statistics Center confirmed the recording of stable inflation rates in vital sectors, including: communications, entertainment and culture, education, health, furniture and furnishings, clothes and shoes, and various goods and services.