Transport fuels August increase in Dubai inflation

• Higher petrol prices and elevated airfares drove an increase in Dubai’s headline inflation to 5.5% in August.
• We have raised our year-end inflation forecast to 5.6%, reflecting the persistence of high oil prices.
• Gains in housing costs are the largest contributor to the headline inflation rate, although price increases in this category have slowed relative to the start of the year.

Higher transport costs drove an acceleration in Dubai inflation in August, reflecting the unevenness of the disinflation path. We expect headline price growth to remain elevated through this year before easing in 2027.

Consumer prices rose 5.5% year on year last month, from 5.3% in July, and 0.3% on the month, up from 0.1% in July.

We have revised our year-end forecast for inflation to 5.6%, reflecting a longer period of elevated oil prices than we had previously expected. Volatile global energy markets present risks to both sides of the forecast...

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