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Bahrain Money Supply Growth Eases; Inflation Up

DUBAI - Bahraini money supply growth slowed for the fifth successive month in February to 17 per cent while inflation in the Gulf state accelerated slightly to 4.7 per cent, official data showed.

M3, the broadest measure of money circulating the economy, stood at 8.09 billion dinars ($21.46 billion) at the end of February compared with 6.92 billion dinars a year earlier, the Central Bank said in a monthly report on its Web site. Annual growth in money supply slowed from 17.7 per cent in January and 21.9 per cent in December, according to revised data released by the Central Bank.

February’s annual money supply growth was the slowest since March 2007, having soared above 30 per cent for much of last year, a key element behind rising inflationary pressures across the oil-exporting Gulf. Narrow money including demand deposits, or M1, rose 12.8 per cent to 2.1 billion dinars while money held in time and savings deposits climbed 15.9 per cent to 4.75 billion dinars.

Bahrain’s annual inflation rate in February advanced to 4.7 per cent from 4.6 per cent in January. Prices climbed 0.36 per cent month on month as food and beverage costs rose 1 per cent, Central Informatics Organisation said on its web site.