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Sunday, March 7, 2021

Qatar’s inflation slows to lowest rate in a year

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Katara Splash Waterpark
Katara Splash Waterpark

Qatar residents spent more money on going out, transport and education last month, new cost of living figures show.

This is despite the fact that inflation for October was at the lowest rate it has been in nearly a year, at 2.2 percent.

In the past 12 months, prices have gone up in eight of the 12 categories used to take the temperature of the nation’s economy.

Photo for illustrative purposes only.
Photo for illustrative purposes only.

For five of these, the year-on-year cost increases were higher than the rate of inflation, according to figures released this week by the Ministry of Development, Planning and Statistics (MDPS).

Recreation and culture saw the biggest jump, becoming 6.6 percent more expensive last month than the same time in 2015.

Transport costs also went up 4.6 percent, likely in part due to fuel price increases that spiked 30 percent overnight in January and have fluctuated monthly for the past six months.

Meanwhile, housing, water, electricity and fuel increased 2.7 percent year-on-year.

Other areas that saw higher costs include furniture and household equipment (up 2 percent), clothing and footwear (up 0.2 percent) and communication (up 0.1 percent).

Slowing down

Though it is now more expensive to live in Qatar than it was last year, price increases are showing slower growth than in previous months.

For example, education costs rose 7.1 percent year-on-year in July, compared to 3 percent last month.

Al Sadd
Al Sadd

And in terms of housing, real estate firm DTZ said last month that rents in popular central districts like Al Sadd and Bin Mahmoud are finally starting to come down.

Additionally, the cost of buying food, entertaining and eating out went down in October, year-on-year.

The MDPS reported the following annual price decreases:

  • Food and beverages – down 2.7 percent;
  • Restaurants and hotels – down 1.8 percent; and
  • Health – down 0.8 percent.

The cost of tobacco stayed flat compared to last year.

Lower inflation

October recorded the lowest overall rate of inflation in 11 months.

The 2.2 percent is some way lower than the MDPS’s forecast of 3.4 percent for 2016 overall, which it published in June this year.

Qatar's rate of inflation, using MDPS statistics
Qatar’s rate of inflation, using MDPS statistics

Over the last year, the rate has fluctuated from 1.9 percent in November 2015 to a peak this year of 3.4 percent in April.

In September, costs rose some 2.6 percent year-on-year.

When making a month-to-month comparison, prices went down in October from September in four areas: recreation and culture (down 2.6 percent), transport (down 1.1 percent), food and beverages (down 0.4 percent) and miscellaneous goods and services, which showed a negligible drop of 0.1 percent.

For illustrative purposes only
For illustrative purposes only

Month-on-month, spending in restaurants and hotels went up 0.9 percent, and up 0.8 percent for clothing and footwear.

Furniture and household equipment saw a 0.6 percent monthly rise, while the costs for housing, fuel, electricity and fuel rose 0.3 percent and health costs went up fractionally at 0.1 percent.

How have your expenses changed this month? Thoughts?

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