Inflation in Gulf under control but food prices a risk

Dubai: Inflationary pressures in Gulf Cooperation Council countries are "contained" though they haven't disappeared completely, Kuwaiti Central Bank Governor Shaikh Salem Abdul Aziz Al Sabah said.

"The global increase in food prices needs attention," Salem said in Kuwait City on Tuesday, according to the text of a speech delivered at a meeting of central bankers from the GCC countries. "Inflation in the GCC has been noticeably contained, but that does not mean that these pressures have disappeared completely."

Inflation in Saudi Arabia, the largest economy among the six GCC members, climbed for a seventh month to 6.1 per cent in August on higher global food prices, Saudi central bank Governor Mohammad Al Jasser said on Sunday. While the increase is "worrying," it's premature to draw conclusions on consumer prices this year, Al Jasser said.

Saudi inflation may slow to 5.5 per cent by the end of the year, according to a report on Saturday by Al Rajhi Capital. Kuwait and Bahrain have also reported a rise in inflation. The rate in Kuwait may rise to 4.5 per cent by the end of the year, from 4 per cent in July, Salem said.