(MENAFN - Khaleej Times) Consumer Price Index, which keeps an eye on rise and fall in inflation, rose 0.64 per cent year-on-year in the first six months of the year due to rising food prices, National Bureau of Statistics said on Tuesday.
According to statistics gathered from across the country, the fall in rents of 3.65 per cent and a slight decrease in the cost of recreational and cultural activities could not stop the CPI from rising.
"The Overall Consumer Price Index for the UAE reached 116.48 in the first half of 2012, the average increase of prices amount to 0.64 per cent compared with first half of 2011," said the Abu Dhabi-based Bureau in its latest data on its website.
However, the Index fell 0.02 per cent in a month-on-month comparison with May, while it increased by 0.35 per cent compared to its value at the end of June 2011.
According to a trader, the price rise in food stuff is a direct consequence of weakening Indian rupee, which has plunged 18.5 per cent over the past year, as most of these items are imported from there.
"The rise in the prices of meat, fruits and vegetables would continue to go up, until Indian currency stop devaluing," he said. But, a leading retailer Lulu Hypermarkets has found a way to check on rising prices. "We have eliminated the role of a middle man while sourcing commodities from India, as these firms charge higher prices for procuring these items from far off villages and towns," an official told Khaleej Times.
"We have established our own sourcing network in India to procure food items directly from the farmers and their producers, a measure which has stabilised the prices," he said.
In the first six months period food and soft drinks prices rose 7.1 per cent, beverages, tobacco and textiles prices increased 4.84 per cent and 4.26 per cent. Other contributory factors included rise in cost of education, furniture and restaurants and hotels rose 3.77 per cent, 3.79 per cent and 3.73 per cent, respectively.
In the same period, housing rents fell 3.65 per cent and "recreational and cultural", a subgroup of the CPI decreased 0.21 per cent.
However, in the month of June the food prices showed 0.26 per cent decline, along with housing rents by 0.06 per cent and textile and footwear by 0.41 per cent.
In Dubai, the consumer prices dropped 0.17 per cent, while the decline was even more sharper in Ajman where it was 34 per cent.
In Sharjah, prices went up 0.53 per cent, followed by Ras Al Khaima 0.47 per cent and Abu Dhabi 0.22 per cent. Separately, Abu Dhabi said prices rose 1.3 per cent year-on-year in the first seven months of the year, on higher food prices. "Meat subgroup surged by 10.2 per cent, fish and seafood up 8.4 per cent, coffee, tea and cocoa gained 9.3 per cent, oils and fats rose 6.6 per cent) and milk, cheese and eggs advanced 2.8 per cent)," a statement issued by Statistics Centre Abu Dhabi said.