The United Arab Emirates economy will grow at its slowest rate in five years in 2007 as crude oil prices ease, National Bank of Abu Dhabi (NBAD) said in a research note.Inflation would also fall to its lowest in three years in 2007 as housing supply rises in Dubai and rent caps curb price increases.The UAE's economy will grow 7% in real terms in 2007, its lowest rate since 2002, when it grew 2.6%, the bank said. It estimated real GDP growth at 8% in 2006. "NBAD's 2007 projection was based on our expectation that average Dubai spot crude oil prices remain around $55 per barrel in 2007, down from an annual average of $60 per barrel range in 2006," said Giyas Gokkent of the bank's research department.
The bank forecast consumer prices would rise 5.5% in 2007 after an 11% surge in 2006. It would be the smallest rise since 2004, when prices increased 5%.An estimated doubling of residential units in Dubai by 2008 as well as caps of 7% on rent increases in the emirates of Dubai and Abu Dhabi would dampen price pressures, the bank said. Source
The bank forecast consumer prices would rise 5.5% in 2007 after an 11% surge in 2006. It would be the smallest rise since 2004, when prices increased 5%.An estimated doubling of residential units in Dubai by 2008 as well as caps of 7% on rent increases in the emirates of Dubai and Abu Dhabi would dampen price pressures, the bank said. Source
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