The UAE's annual inflation rate stayed at a one-year peak of 0.9 per cent for the fourth straight month in August, but rose at the fastest monthly pace in 11 months on a food price jump, data showed.

Prices fell for months in the world's third largest oil exporter last year, under pressure from the global crisis.

Dubai's debt woes have held down price pressures in 2010.

Consumer prices grew 0.5 per cent month-on-month in August, after a 0.3 per cent increase in July, data from the National Bureau of Statistics showed.

'This is very benign inflation,' said John Sfakianakis, chief economist at Banque Saudi Fransi.

'Transportation costs have come down and on the food side we see global and regional food inflation rising.'

The food component, which accounts for 14 per cent of the UAE basket, soared 2.0 per cent month-on-month, the sharpest rise this year, after staying flat in the previous month.

Food inflation traditionally climbs up during Ramadan, which ended in mid-September.

Transport cost growth, the third largest basket component with a 10pc weight, slowed to 0.6 per cent from July's 3.5 per cent, when it was boosted by a rise in petrol price.-Reuters