The nation’s consumer price index (CPI) gained 0.81 percent last month from a year earlier, rising at the fastest pace in 14 months, as Lunar New Year demand drove up food costs, and the effect might be more evident this month, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday.
The mild increase in the government’s inflation gauge gives the central bank room to cut interest rates next month to stimulate the economy without concerns over runaway inflation.
“Prices of vegetables, fruit, fishery products and home appliances all rose last month compared with a year earlier, underpinning the CPI increase,” DGBAS Deputy Director Tsai Yu-tai (蔡鈺泰) said at a news conference.
Taiwanese celebrate the week-long Lunar New Year holiday with family reunions and feasts, driving up food costs throughout the season.
The cold snap last month also contributed to the CPI’s increase, as it damaged crops, shrinking supplies, Tsai said.
Both factors will persist for a while, as another cold front is to arrive over the weekend and the holiday is to last through next week, Tsai added.
Prices of oranges and mustard greens, among other things, shot up due to their association with good luck, longevity and prosperity, making them popular during the holiday season, Tsai said.
Fish are also in high demand, because its Mandarin pronunciation sounds like the word “abundance.”
The CPI after seasonal adjustment fell 0.22 percent last month, affirming the holiday’s effect on prices, the report said.
Food costs increased 2.71 percent last month from a year earlier, raising the inflationary gauge by 0.43 percentage points, the report said.
Living costs increased 1.57 percent last month, attributable to a 21.18 percent hike in electricity prices, the report said, as electricity rebates last year lowered the comparison base, it said.
Cheaper oil prices remained a drag on transportation and communication costs, which declined 2.88 percent last month from a year earlier, Tsai said, citing the 15.5 percent decline in international crude prices as the main reason.
The wholesale price index — a measure of production costs — fell 4.82 percent last month, significantly easing from a revised 7.23 percent decline in the previous month, the report said.
The factor depressed export prices by 7.84 percent last month in US dollar terms, meaning an equal volume of shipments would cost less this year, unfavorable for export showings, the report said.
Poor exports might prompt the central bank to cut interest rates by another 12.5 basis points during its next board meeting in March to stimulate GDP growth, DBS Bank and Deutsche Bank forecast.
Lower borrowing costs might allow companies more incentive to increase capital expenditures, they said.
Ryanair, Transavia, Volotea and other low-cost airlines are feeling the financial pain from high jet fuel prices as a result of the Middle East war and are cutting flights. The closure of the Strait of Hormuz has taken a huge chunk of oil supplies off the market, sending the price of jet fuel soaring and triggering fears of shortages that could force airlines to cancel flights. Airlines are not waiting for a lack of supplies to react. “Travel alert: Airlines are cutting thousands of flights right now,” Travel Therapy host Karen Schaler said in an Instagram reel this past weekend.
MANAGING RISKS: Taiwan has secured LNG sufficient to cover 95 percent of electricity demand for next month, UBS said, describing the government’s approach as proactive UBS Group AG has raised its forecast for Taiwan’s economic growth this year to 8 percent, up from 6.9 percent previously, and said expansion could reach as high as 8.6 percent if external energy shocks are avoided. The upgrade reflects a stronger-than-expected first-quarter performance and sustained momentum in artificial intelligence (AI)-driven exports, which UBS said are providing a firm foundation for growth despite geopolitical and energy risks. Taiwan’s GDP expanded 13.69 percent year-on-year in the first quarter, the fastest growth since the second quarter of 1987, the Directorate-General of Budget, Accounting and Statistics (DGBAS) reported on Thursday. On a seasonally
The list of Asian stocks that benefit from business partnership with Nvidia Corp is getting longer, as the region further integrates into the artificial intelligence (AI) chip giant’s business ecosystem. Just in the past week, South Korea’s LG Electronics Inc, Taiwan’s Nanya Technology Corp (南亞科技), as well as China’s Huizhou Desay SV Automotive Co (德賽西威) and Pateo Connect Technology Shanghai Corp (博泰車聯) have become the latest to rally on news of tie-ups, supply-chain participation or product collaboration with the US chip designer. Asian suppliers account for about 90 percent of Nvidia’s production costs, up from about 65 percent last year, data compiled
The Fair Trade Commission’s (FTC) ongoing review of Grab Holdings Ltd’s US$600 million acquisition of Foodpanda Taiwan’s operations, announced on March 23, has taken on fresh urgency as industry experts warn that the transaction could embed significant Chinese cybersecurity vulnerabilities into Taiwan’s digital infrastructure through Grab’s deep ties to autonomous-driving firm WeRide (文遠知行). Less than 16 months after the FTC blocked Uber Eats’ direct attempt to acquire Foodpanda Taiwan — citing potential combined market shares of 80 to 90 percent — the emergence of Grab as the buyer has prompted questions about whether the same competitive harm is simply being rerouted
RSS