With the strong surge in government spending, there are signs that Qatar inflation might pick up again and touch 3.5% in 2014, Standard Chartered has said.
“Rental yields are likely to be a key driver and we expect they will begin rising in 2014. We believe this will be driven by the size of the project pipeline in Qatar, which will require an inflow of expatriate employees, generating a new pool of tenants,” the bank said in its country report.
Population data from Qatar’s Statistics Authority show the population rose from 676,000 to 1.71mn between 2002 and 2011. The LNG boom drove this 153% population
“We expect the new phase of investments to bring about another population rise, and Qatar’s population will reach 2mn before 2015-end. In August alone the rents component of the CPI basket (32.2% weighting) rose by 6.7% year-on-year. Overall inflation in August, including the rental component, rose by 2.8% (up 1.5% excluding rents). We raise our 2014 inflation forecast for Qatar to 3.5% from 2.5%, given the more positive growth dynamics related to the population and
workforce,” it said.