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Monday, November 30 - 2009

Qatar must address inflation to sustain growth

  • Qatar: Monday, January 21 - 2008 at 12:52

Marios Maratheftis, Head of Research for the Middle East, North Africa & Pakistan at Standard Chartered Bank, has advised the government to address the currency inflation issue in order to maintain growth levels. Speaking at the MEED Qatar Conference he said: 'Right now the region is not prepared to drop the peg to the dollar as the issue is too sensitive, but the second best action would be to revalue the riyal by about 8 to 10 per cent.'

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Despite coming under pressure to lift the dollar peg, because it has lost about 40 per cent of its value, the GCC countries have so far refrained, due to the "political string" attached to that decision.

But Maratheftis believes an increase in the supply of goods would help relieve inflationary pressures. 'One definition of inflation is when too much money chases too few goods, so the increase of supply will help, but at the same time something needs to be done about the currency.'

See also:
Qatar not affected by US economy drop
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