Inflation in consumer prices eased for the second consecutive month in November, National Bank of Kuwait said in its montlhy report Tuesday. Inflation came in at 3.4 percent year-on-year (y/y), versus the 3.6 percent reading in October, as inflation in most components slowed or remained broadly steady.
Inflation in 2016 is expected to average around 3.4 percent. Price growth was mostly unchanged from the 2015 pace as the effects of higher fuel prices were largely offset by downward price pressures from housing, food and other imported goods.
Inflation in the transportation sector appears to be holding steady for the time being. Inflation in this segment jumped to around 10 percent y/y in September and has remained steady around that mark in October and November.
Inflation in local food prices maintained its weakness in November at 0.2 percent y/y. Inflation in this segment has been weak as global food prices receded further into deflationary territory.
Inflation in housing services has eased markedly amid a cooling real estate market. After trending upwards for almost a year, housing inflation, which is comprised primarily of housing rents and is updated quarterly, steadied, at a still high, 7.4 percent y/y in September.
In 2017, inflation is projected to climb to 4 percent as the government introduces higher electricity and water tariffs from May 2017.