Dubai's '09 inflation rate lowest in five years

Dubai witnessed its lowest inflation rate in five years in 2009, according to a new report by the Dubai Chamber of Commerce and Industry. Dubai's inflation rate stood at 4.1% in 2009 as compared with 11.3 per cent in 2008. Housing, water, electricity and gas price growth, accounting for the largest share of the Consumer Price Index weight, stood at 2.4% in 2009 as falling rental and property prices meant that individuals and businesses were left with more disposable income in their pockets. 'Dubai recorded its highest inflation rate in over 20 years at 11.3% in 2008 on the back of a surge in rents and food prices due to higher global commodity prices and a sharp increase in its import bill due to the weakening US dollar. This trend has clearly reversed in 2009 due to the resurgence in the US dollar, falling commodity prices, a correction in the real estate sector and weakening domestic demand,' the report said.