Inflation in the capital drops in May for the first time in several months

ABU DHABI // Price inflation in the capital is slowing down.

Prices in Abu Dhabi in May were up 1.7 per cent from May 2011 - and while that rate is the second-highest of any month this year, it also represents a decline from the 1.8 per cent year-on-year inflation rate recorded for April.

Year-on-year inflation had risen for three straight months - from 0.6 per cent in February to 1.3 per cent in March to 1.8 per cent in April - before May's slight reprieve.

A report yesterday from the Statistics Centre-Abu Dhabi further noted that restaurants and hotels led the inflation parade in May, surging 19.1 per cent from a year earlier.

Alcoholic beverages and tobacco were up 10.7 per cent, and food and non-alcoholic beverages gained 4.9 per cent.

At the same time, prices in the "housing, water, electricity, gas and other fuels" were down 1.3 per cent from a year earlier.

The report also noted that:

Ÿ May's prices rose 1.8 per cent for households in the bottom and middle welfare levels, and 1.6 per cent for households in the top welfare level.

Ÿ May's prices rose 1.9 per cent for Emirati households, 1.4 per cent for expatriate households and 2.1 per cent for mixed households.

For the first five months of the year, rather than for May alone, fully two-thirds of inflation was accounted for by the restaurants and hotels group.

On the other hand, inflation was reined in the lower prices for the "housing, water, electricity, gas and other fuels" group - probably a result of sharply reduced rents in the capital.

newsdesk@thenational.ae