Thu, Jan 07, 2016 - Page 13 News List

CPI inches up 0.14% as food offsets crude effect

RELIABLE INDICATOR:Last month’s 0.78 percent rise in core CPI should put an end to concerns over deflation, DGBAS Deputy Director Tsai Yu-tai said

By Crystal Hsu  /  Staff reporter

The consumer price index (CPI), the official inflation gauge, gained a mild 0.14 percent last month year-on-year, as food price hikes more than muted declines in oil-related consumption, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday in a report.

It is the fourth consecutive month the CPI has been in positive territory as cheap crude oil prices continued to weigh — but the effect is attenuating, the statistics agency said.

“Prices for fruit, vegetable, meat and fishery products all climbed higher [last month] year-on-year, which accounts for the CPI’s slight advance,” DGBAS Deputy Director Tsai Yu-tai (蔡鈺泰) said at a news conference.

The pressure of rising food prices on inflation is not that significant, considering that rising food prices failed to reverse the 0.31 percent decline in CPI for the whole of last year, the report said.

The CPI after seasonal adjustments saw a 0.2 percent fall last month, the report said.

Core CPI — a more reliable and long-term inflation indicator because it excludes all volatile items — saw a 0.78 percent increase last month, the report said, adding that the reading hovered at a similar level of about 0.79 percent for the whole of last year.

The results should put an end to concerns over deflation, even though cheap oil depressed transportation and energy costs last year and in the second half of 2014, Tsai said.

By category, food costs increased 2.99 percent last month year-on-year, led by a 12.17 percent jump in fruit prices and a 5.77 percent rise in vegetable prices, the report said.

Transportation and communication prices fell 3.91 percent, pulled down by a 19.04 percent plunge in fuel costs, the report said.

The wholesale price index (WPI) — a measure of production costs — dropped 7.06 percent year-on-year last month, easing from a revised 7.93 percent decline in November, the report said.

Cheap crude oil prices have constrained prices for chemical, mineral and plastic products, the report showed.

The products account for 20 percent of the nation’s overall exports.

For the whole of last year, the WPI fell 8.82 percent, the report showed.

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