Qatar’s inflation fell 0.79% in June mainly on easing of rents and lower prices of food as well as garments. The consumer price index (CPI) for the first six months of this year showed an overall downward trend with the general CPI 2.6% lower than in January, the Qatar Statistical Authority (QSA) said. The average price level fell in June after rising consecutively in April and May.

The average price level fell in June after rising consecutively in April and May. Inflationary pressure in Qatar eased this year after hitting a high of almost 17% in the middle of 2008 as oil prices fell from last year’s record highs.
“Inflation has become a non-issue (in Qatar), although downward pressure on prices of goods and services, notably in trade and infrastructure, have been arrested,” Dun and Bradstreet CEO Rajesh Mirchandani had earlier said.
According to the Qatar Central Bank, the money supply has been on a decelerating mode.
Housing, utilities and related services – which carry the highest 32.2% weight in the CPI basket – fell 2.23% in June month-on-month (m-o-m) after having risen 0.59% and 0.75% in April and May respectively.
The most “significant” decrease in the CPI was seen in rental prices which had been experiencing high rates of growth in the previous years, the QSA said, adding household rent, water and electricity and household maintenance component of the CPI was now 4.4% lower than in January 2009.
Food, beverages and tobacco – whose group has 13.2% weight in the CPI basket – was down 0.66% in June (m-o-m). The group witnessed the decline for the second month. It is 2.6% lower than in January 2009.
“Offsetting the 2.6% decrease in food prices over the first six months of 2009, beverages were up 2.7% and tobacco products by 9.4%,” the QSA said.
Garments and footwear – which carry 5.8% weight in the CPI basket – plunged 3.47% in June compared to May. The group witnessed fall for the second consecutive month as it had fallen 1.66% in May.
“During 2009, the CPI index showing the largest decline was clothing and footwear, which was 8% lower in June compared with the beginning of the year,” according to QSA.
Medical care and medical services – whose group has 2% weight – was down 0.11% in June (m-o-m). In the previous month, it had risen 1.12%.
Miscellaneous goods and services – which carry 7.2% weight in the CPI basket – was down 0.64% in June compared to May. The index fall has been sharper than that in May when it fell only 0.07%.
However, Transport and Communications – which 20.5% weight in the CPI basket – rose 1.12% in June (m-o-m), “reflecting the seasonal increase in airline fares associated with summer travel demand.” The group witnessed the increase for the second month in June.
Communication prices continued the downward trend seen during 2009 and fell 0.9% compared to May and were down 11.5% against the beginning of the year.