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The cost of food and transport in Qatar continued to rise in August amid the ongoing Gulf dispute, according to new government figures.

But price drops in other categories such as housing, clothing and recreation offset those increases, helping the overall cost of living decline marginally year-on-year.

The Consumer Price Index (CPI) stood at 108.3 in August, down .4 percent from the same month in 2016, the Ministry of Development Planning & Statistics (MDPS) said.

Prices increases

Price increases were still seen in four main categories, however.

They are: transport (6.3 percent); education (3 percent); food and beverages (2.8 percent); and health (2.8 percent).

MDPS

The cost of food spiked after the Gulf dispute began.

In terms of food prices, Qatar saw an improvement in August from the 4.5 percent year-on-year jump seen in July.

Transport costs also increased at a lower rate last month than in July, when it jumped 7.5 percent.

The numbers could signify that Qatar is getting a handle on food and transport inflation caused by its neighbors’ economic boycott.

However, Qatar’s population fell to its annual low in August. This could mean that food prices didn’t rise as much because demand was lower last month than in July.

Price decreases

Notably, the cost of several other household expenditures continued to fall last month, offsetting any increases.

They include:

  • Water, housing, electricity and fuel: Down 4 percent;
  • Recreation and culture: Down 3.8 percent;
  • Clothing and footwear: Down 3.1 percent year-on-year;
  • Miscellaneous goods and services: Down 1.6 percent;
  • Communication costs: Down 1.1 percent;
  • Restaurants and hotels: Down 0.7 percent; and
  • Furniture and household equipment: Down 0.7 percent.

The cost of housing has been falling for some time now, and is expected to continue doing so in the near future.

MDPS

Housing, water, electricity and fuel costs falling

According to real estate agents DTZ, slower population growth and increased supply in some housing areas are the cause of the softening market.

This has translated into rent reductions of around QR1,000 a month in some parts of Qatar compared to the last quarter of 2016.

Thoughts?

Lesley Walker / Doha News

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The cost of food and transport jumped last month amid an economic blockade against Qatar by its neighbors.

But the crisis barely affected the overall cost of living in the country during July, new government statistics show.

Goods and services for local residents were up just 0.2 percent in July compared to the same time last year, according to the Consumer Price Index (CPI).

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That’s because spikes in food and transport were offset by declining costs in other areas, including housing and clothing.

Food costs jump

Food and drink rose 4.5 percent compared to July 2016, while transport costs shot up 7.5 percent year-on-year, the Ministry of Development, Planning and Statistics (MDPS) said yesterday.

The higher costs of food won’t come as a surprise to Qatar residents.

Many have complained about rising grocery prices since the neighboring Arab states began their blockade of Qatar in early June.

Shabina S. Khatri / Doha News

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In particular, the cost of fresh produce and dairy goods, many of which were previously brought in from Saudi Arabia, appear to have seen the biggest jumps in price.

This is despite the Qatari government covering much of the additional cost of importing them from further away.

Notably, food costs are more controlled in Ramadan, which ended in late June.

MDPS

Food and drink price increases, July 2017 CPI

This as well as the blockade could explain why June prices rose only by 2.4 percent compared to the same month last year.

Other areas that showed inflation in July include education costs, which rose 3 percent year-on-year; and healthcare, which went up 2.8 percent.

The cost of several other household expenditures fell last month however, offsetting any increases. They include:

  • Clothing and footwear: Down 4.3 percent year-on-year;
  • Water, housing, electricity and fuel: Down 3.6 percent;
  • Recreation and culture: Down 2.5 percent;
  • Miscellaneous goods and services: Down 2 percent;
  • Communication costs: Down 1.1 percent;
  • Restaurants and hotels: Down 0.8 percent; and
  • Furniture and household equipment: Down 0.7 percent.

Meanwhile, tobacco costs remained flat, year-on-year.

So, although some of the prices stickers on goods at the supermarket give the impression that life in Qatar is more expensive, actually in many areas, it is cheaper than it was at the same time last year.

At the beginning of this year, the CPI stood at 1.2 percent – and that was the lowest it had been in the previous 12 months.

Rental drops

Increasingly expensive residential rental accommodation had been one of the main factors affecting living costs throughout 2015 and early 2016.

Peter Kovessy

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However, the residential rental market began softening in the latter part of last year, continuing through early 2017.

Real estate agents DTZ reported in May that slower population growth and increased supply in some housing areas have translated into rent reductions of around QR1,000 a month compared to the last quarter of 2016.

How has your budget changed in Qatar? Thoughts?

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It’s continuing to get more expensive to live in Qatar, but costs are not rising as much as they used to, according to new government figures.

The first Consumer Price Index (CPI) of the new year has shown a 1.2 percent increase compared to January 2016.

That’s the smallest rise in at least 12 months.

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It was driven in large part by the increasing costs of transport and education, which rose by 4.7 and 3 percent, respectively.

The index is published monthly by the Ministry of Development, Planning and Statistics (MDPS) and is used to take the temperature of the nation’s economy, particularly household spending.

It examines the costs of an average basket of goods and services and charts spending trends.

What’s changed

Month-on-month, inflation remained rather stable. But there was an uptick when comparing annual figures.

Most notably, fuel prices and the cost of school tuition have been going up in recent months.

Meanwhile, a previous big driver of inflation – housing – increased marginally (.6 percent) year-on-year.

Apartments in Al Sadd

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Photo of Al Sadd for illustrative purposes only.

Other categories that went up in price included furniture and household equipment (1.3 percent); recreation and culture (2.8 percent); and miscellaneous goods and services (1.7 percent).

All of the increases however were offset by noticeable drops in the prices of these categories:

  • Food and beverages, down 1.9 percent y-o-y;
  • Clothing and footwear, down 1.3 percent y-o-y; and
  • Restaurants and hotels, down 2.7 percent y-o-y.

Additionally, health and communication costs fell marginally (by .2 percent and .1 percent, respectively), while tobacco remained unchanged as usual.

How is your budget doing in 2017? Thoughts?