Month-on-month inflation rate increased by 0.12 per cent in December compared to an increase of 0.35 per cent in November 2010, data from the Qatar Statistics Authority shows.
Food prices showed a flat growth with an incremental monthly increase of 0.09 per cent in December and 0.14 per cent in November. Rental prices have continued to contract on a monthly basis since the beginning of 2009, registering -0.13 per cent month-on-month in December, and -0.08 per cent in November.
On an annual basis, inflation increased 0.4 per cent in December, from -0.03 per cent in November – the first positive rate in 2010. Food inflation increased 3.8 per cent annually in December, in line with a 3.7 per cent increase seen in November. Rental prices remained in contraction, registering -6.7 per cent annually in December, and -7 per cent in November.
Beltone Financials clarified that the release of the December 2010 inflation brings Qatar's overall 2010 inflation to -2.4 per cent, from -4.9 per cent in 2009. Food prices rose 2.1 per cent in 2010 after a 1.2 per cent increase in 2009. "Rental prices, the largest component of the Qatari CPI, (32.2 per cent of the basket) saw a wider contraction with -12.8 per cent in 2010 compared to -12 per cent in 2009, weighing down the overall CPI," said the investment bank, adding that the 2010 inflation outturn was in line with Beltone forecast of -2.5 per cent.
"Going forward, we expect that inflation will move into positive territory, averaging 1.5 per cent in 2011, on the back of rising food prices, a weaker forecast US dollar, along with a steady and gradual improvement in rental costs," Beltone concluded.