(MENAFN- Kuwait News Agency (KUNA)) National Bank of Kuwait (NBK) on Tuesday expected Kuwait's inflation rate to remain steady and low, averaging close to three percent throughout the remaining of 2012.
In a brief economic bulletin, NBK said "inflation in the Consumer Price Index (CPI) was 2.8 percent last June, similar to its May rate, and still the lowest figure for more than two years." This was the second consecutive month where food price inflation was much lower than previous averages, coupled with subdued inflation in most other segment, the report noted.
However, the it also noted that core CPI inflation was 2.1 percent when compared to the same period of last year.
"It has remained under control for the first half of 2012 and should continue to be for the remainder of the year," NBK noted.
"The core measure excludes food and beverage prices, and therefore is less affected by variation in international commodity prices." The bulletin added that food inflation for June is still considered to be relatively on the low side, as the average for the first half of 2012 was 6.9 percent and 9.7 percent for full year 2011.
"Fruit and vegetable prices fell for the third month in a row, as they went down 2.8 percent," the report added.
Meat, poultry, and fish prices were up 6.1 percent, as the fish component remains the most volatile.
Food prices may see some upward pressure in the near term as Ramadan effects show up in the data, and also perhaps in the long term as the effects of unfavorable weather conditions in the US and Europe reaches the consumer level.
"Prices for household goods and services were flat and up 1.4 percent, and inflation has also remained in check in most other components," NBK said.
Transport and communication, education and medical care, as well as other goods and services all stayed within their normal ranges, similar or lower than their May levels and below 3 percent, the report stated.
"Overall, this is a clear sign of tame inflation in many of the consumer segments and halfway into the year, inflation remains modest, averaging 3.4 percent," the report concluded.
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