Tue, Oct 08, 2013 - Page 13 News List

Inflation builds on vegetable prices

DAMP CONDITIONS:A significant year-on-year rise in vegetable prices as a result of several storms raised headline inflation by 0.76 percentage points last month

By Amy Su  /  Staff reporter

Annual inflation last month expanded at its fastest pace since April, as vegetable prices climbed after the nation was struck by heavy rain and typhoons, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday.

The consumer price index (CPI) rose 0.83 percent last month compared with a year ago, following a 0.79 percent year-on-year drop in August, the DGBAS said in its latest monthly report.

DGBAS Deputy Director Tsai Yu-tai (蔡鈺泰) attributed the rise in consumer prices last month to a surge in vegetable prices triggered by the various tropical storms — Trami, Kong-rey and Usagi — and torrential rains over the past two months.

“Vegetable prices increased 27.93 percent last month from a year earlier,” Tsai told a press conference.

Although the supply of vegetables during August last year was affected by typhoons, they normalized in September last year for a relatively low basis of comparison, further raising the growth year-on-year for last month, Tsai said.

The significant year-on-year rise in vegetable prices also raised headline inflation by 0.76 percentage points last month, while overall food prices showed a 2.36 percent year-on-year growth, the report showed.

However, fruit prices last month showed a 14.47 percent decline from a year earlier, statistics showed.

Excluding vegetable, fruit and energy prices, core CPI grew by 0.81 percent last month from a year ago, compared with an increase of 0.63 percent in August, DGBAS data showed.

In the first nine months of this year, the headline inflation rose 0.55 percent from a year ago, DGBAS data showed.

The wholesale price index (WPI) extended its trend of year-on-year contraction last month, falling by 2.69 percent from the same period last year, its 19th straight month of decline, the DGBAS said.

The WPI dropped by 2.93 percent in the first nine months of the year.

Capital Securities Corp (群益證券) said consumer prices may maintain mild growth year-on-year in the fourth quarter, amid the continuing fall of prices for heavy commodities.

However, the government’s plan to raise electricity rates from Tuesday last week — which is expected to boost the CPI by 0.19 percentage points in the fourth quarter according to the DGBAS’ forecast — may cause some inflationary pressure, the brokerage house said in its latest report.

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