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Posted On: 9 April 2009 10:55 am
Updated On: 12 November 2020 02:09 pm

Inflation to ease further: Study

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As the Qatari economy continues to remain stable despite the recessionary pressure mounting worldwide, inflation is expected to ease further, stated a key study whose findings were released yesterday. The downward pressure on prices remain intact and the biggest respite is expected to come from the building, construction and real estate sector with 39 percent respondents covered for the study anticipating a fall in selling prices. Dun & Bradstreet South Asia Middle East (D&B) in association with the Qatar Financial Centre (QFC) and alkhaliji bank yesterday released D&B Business Optimism Index for Qatar for the second quarter (Q2) of 2009. Releasing the report at a news conference at the QFC, the CEO and Director-General of the QFC Authority, Stuart Pearce, said the number of firms expressing interest in operating in and from Qatar through the QFC had not dropped over the past year and had actually risen. Robin McCall, alkhaliji’s acting chief executive, Rajesh Mirchandani, CEO of D&B, Tarik Al Ashban, Associate consultant of D&B and Charbel Cordahi, senior principal, investor relations, alkhaliji, were also present. A majority 54 percent of respondents expect the cost of capital to stabilise in Q2 with the government taking measures to lower the interest rate to help the economy minimise the impact of the world financial gloom. However, the availability of finance remains a key issue to the business community with 40 percent of the respondents surveyed citing a concern over it, while 46 percent of those surveyed said they did not expect any change in selling prices. The sentiments in the energy sector seem to be showing some signs of revival. A majority 57 percent of respondents from this sector have cited the fall in oil prices and another 43 percent have referred to possible project delays as the key concerns facing the industry in Q2. As for the business expectations about the global recession, 44 percent of the respondents in the non-hydrocarbon sector expect the global economic recovery to begin sometime this year. But at least 27 of the companies are uncertain about the revival of global economic growth. Qatar is expected to maintain a budget current account surplus, despite increased spending to stem the impact of the global economic crisis. The D&B Business Optimism Index (BOI) for Q2 reveals that sentiments in the Qatari economy have taken a hit due to the outlook of the global economy. Demand levels in the Qatari economy are expected to decline which will impact the profitability of businesses across all sectors. The next BOI report will be released in July this year.