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Posted On: 26 January 2010 02:26 pm
Updated On: 12 November 2020 02:10 pm

Falling rents drag down inflation in December

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The continuing decline in rents has helped Qatar’s inflation drop 0.3% in December, data released by Qatar Statistics Authority reveal. The rents category, which has the largest weight in the basket, fell 0.7% in December after a 2.9% decline in November. Food prices remained flat in December while transport prices were 1.3% up last month. Consumer price index (CPI) stood at 121.5 points in December compared with 121.8 in November. Qatar’s consumer prices have fallen for the seventh month in a row, aided by continuing drop in rents. The consumer price index (CPI) is a measure estimating the average price of consumer goods and services purchased by households. The percent change in the CPI is a measure estimating inflation. A recent study by real estate agency Century 21 indicated prices and rental rates declined about 25% in Qatar last year. In December alone, apartment rental rates declined up to 10% in some areas. Qatar is expected to book deflation of 3.5% in 2009, a recent Reuters’ poll showed. The country had seen a ‘high inflation’ of 15.2% in 2008. Consumer prices in the world’s largest liquefied natural gas exporting country are expected to rise this year, but inflation should stay at low single-digit levels although Qatar’s economy should largely outperform other Gulf oil exporters. Qatar’s nominal gross domestic product rose 11% in the third quarter compared with the previous quarter, a drop of 28.3% in nominal terms from a year ago. The country’s GDP reached QR75.5bn in current prices in the third quarter. Qatar is expected to keep outperforming key players in the world’s top oil producing region — Saudi Arabia and the United Arab Emirates — in the coming years mainly due to the massive expansion of its gas facilities. Next year will mark an important milestone for Qatar’s gas industry, as all LNG production trains will be completed and ready for operation. This will bring the total number of LNG trains in Qatar to 14, six of which are the world’s largest. With various expansion projects currently underway and expected to come on line in the coming years, production capacity will increase to 77mn tonnes by 2010. In October, Qatar celebrated the inauguration of RasGas Train 6, which coincided with the 10th anniversary of the company’s production. This is one of the six giant 7.8mn tonnes a year trains under development through expansions at Qatargas and RasGas. Earlier this year, two other LNG trains - Qatargas trains 4 and 5 were inaugurated. Qatar is also investing billions of dollars in new petrochemical ventures through QP, Qapco and their joint ventures. Gulf Times