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Oman records lowest inflation rate in GCC

The Sultanate of Oman recorded the lowest inflation rate in the Gulf Cooperation Council countries during September 2022. The inflation rate in Oman increased by 2.4 per cent year-on-year (y-o-y) during September 2022, according to National Centre for Statistics and Information (NCSI).

Meanwhile, Kuwait witnessed an increase inflation rate of 4.1 per cent y-o-y mainly driven by education price index, followed by food and beverage price index. Inflation is expected to continue to slow down in Kuwait due to the decrease of the global food prices. Saudi Arabia’s inflation rate recorded an increase of 3.1 per cent y-o-y in September 2022 — its highest monthly y-o-y rate change since June 2021. On the other hand, the UAE’s Central Bank forecasted 5.6 per cent inflation rate rise for the Emirates during 2022 — the country’s highest rate in six years. As a result of the rising cost of living attributed to inflation, the Emirati population have started to cut back on spending in certain necessities such as clothes and petrol. Qatar’s inflation rate hit the highest in nine months after it increased by 6 per cent y-o-y during September 2022. Qatar’s inflation growth during the month was mainly driven by recreation and culture sector which registered a 35.6 per cent y-o-y rise as the country makes final preparations to host the Fifa World Cup. The inflation rate in Bahrain grew at the highest monthly rate in nearly ten years recording 4 per cent y-o-y increase during August 2022, as per latest report by Kamco Invest.

The moderate growth of inflation rates in Oman is mainly due to the increase in prices of major commodity categories. Prices in the education category increased by 5.1 per cent y-o-y, while prices of food and non-alcoholic beverages increased by 5 per cent during the same period. In addition, prices for the transportation category increased by 3.1 per cent during the month while the culture and entertainment group prices increased by only 1.6 per cent during September 2022.

Despite the turmoil in global supply chains against the backdrop of the continued implementation of some measures related to the Covid-19 pandemic at an intermittent pace in some countries such as China, and other international crises such as the conflict between Russia and Ukraine, which led to an increase in the prices of basic commodities such as foodstuffs, Oman succeeded in containing inflation in line with the target level of the five-year development plan set at 2.8 per cent. The Omani government has taken some proactive measures such as capping monthly fuel price hikes and ensuring direct supplies of food to curb inflation at acceptable levels during the year, the report added.

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