Growth Rate - Consumer Price Index for Qatar Assignment

Growth Rate - Consumer Price king for Qatar - Assignment Examplewith prev. year (a) Prev. year (b) (a / b)100 2001 1.2 82.7 1.45% rising prices 2002 0.2 83.9 0.24% inflation 2003 1.9 84.1 2.26% inflation 2004 5.9 86.0 6.86% inflation 2005 8.1 91.9 8.81% inflation 2006 11.8 100.0 11.8% inflation 2007 15.4 111.8 13.77% inflation 2008 19.2 127.2 15.09% inflation 2009 -7.1 146.4 4.85% deflation 2010 -3.4 139.3 2.44% deflation 2011 2.6 135.9 1.91% inflation ( The World pious platitude, 2012) Qatars economic progress was impressive from 2005 to 2009 in wound of the global recession in the later part of the period. There was a 9 percent genuinely overall GDP (Gross Domestic Product) growth. In the year 2008, GDP growth was 16 percent. This was because of increase in the production level of liquefied natural gas (LNG) and condensates. Also, there was a good development in the nonhydrocarbon sector. All these factors led to continuous price inflation from 2005 to 2009 (IMF Executive Boa rd Concludes 2009 Article IV source with Qatar, 2010). Inflation reached the peak in 2008 with 15 percent. This was the highest inflation rate among all the GCC countries and Qatar which is the wealthiest Arab nation experience such a huge jump in inflation rate because of weakening US dollar. The inflation was also due to other factors like increase in domestic rents, rise in food prices and obese domestic demand of oil. According to a study conducted by Qatari National Bank (QNB), there was a three-fold increase in consumer prices in Qatar during the years between 2005 and 2009 resulting in average of 8.9 percent. This figure is in truth high compared to the average during 2000-2004 which was 2.5 percent. The consistent rise of housing costs was the main reason behind the maturation inflation from 2005 till 2008 (Kawach, 2010). However, in 2009 Qatars economy witnessed a laconic deflation of 4.85 percent. This was due to a sharp decline in the domestic house rents. This decl ine in domestic house rent occurred in all Gulf Cooperation Council (GCC) countries, but Qatar witnessed the maximum decline. Economic growth was mostly encouraged by the monetary policy through consistent spending in development sector. However, for this few projects of government were given great priority. Because of the increase in prices of oil and gas the external current account was approximated a large intemperance with almost 15.7 percent of GDP. The gross reserve of central bank was further strengthened to around 5 months of imports of goods and services (IMF Executive Board Concludes 2009 Article IV Consultation with Qatar, 2010). Qatar which is the leading LNG exported in the world confront deflation for the second consecutive year in 2010 with rents declining more than the previous year. According to Saudi American Bank Group (SAMBA) Qatar was deeply entrenched in deflation for two fiscal years although there was speculation of sound growth in the economy due to incr easing LNG exports, rising oil prices and large scale human race spending. During the last quarter of 2010, oil and non-oil sectors were speculated for upward trends while construction and real estate industries remained unchanged. SAMBA give tongue to excess supply in the real estate sector continues to put pressure on rents which is world reflected in