Average inflation in United Arab Emirates

It is the average annual inflation rate for the United Arab Emirates: the average change in consumer prices over the year rather than the year-end figure. It reflects the average rise in the household basket of goods and services across the full year.

It is obtained by comparing the average level of the consumer price index in one year with that of the previous year. It draws on regular price collection across a sample of outlets weighted by household spending, with comparable series taken from the IMF's annual estimates.

Average inflation shapes purchasing power, consumption and economic-policy decisions. In the UAE, with the dirham pegged to the US dollar, there is no independent rate policy, so inflation is watched more as a barometer of the cost of living and activity than as a driver of the currency.

It is a low-frequency figure and subject to revision. As an annual average it smooths intra-year peaks and can mask recent turning points, while administered housing and energy prices weigh heavily on the reading.