Wed, Jul 06, 2016 page12

• CPI sees slowest gain in five months

  STABILIZATION: The consumer price index rose 0.9 percent as rises in fruit prices slowed. Without the rise in fruit prices, the CPI would have risen only 0.14 percent

  • By Crystal Hsu / Staff reporter
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  The consumer price index (CPI) rose 0.9 percent last month from a year earlier, its slowest gain in five months, as hikes in fruit prices eased, although they remained the fastest in more than a decade, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday.

  The latest CPI data indicated benign inflation as food costs continued to advance more rapidly than other consumer items, suggesting heavier price burdens for low-income earners.

  “Overall consumer prices have stabilized as evidenced by the smaller than 1 percent increase in the CPI reading,” DGBAS Deputy Director Tsai Yu-tai (蔡鈺泰) told a news conference in Taipei.

  The inflationary gauge has hovered near the 2 percent alarm level since February due to drastic rises in vegetable and fruit prices, as bad weather from the winter and two typhoons last year continued to disrupt supply, Tsai said.

  The CPI, after seasonal adjustment, edged down 0.08 percent last month, affirming an almost neutral trend, according to the agency’s monthly report.

  For the second quarter, the inflationary index climbed 1.33 percent, down from 1.75 percent in the first quarter, and averaged 1.54 percent in the first half of the year, the report said.

  Supply disruptions subsided last month, slowing the rise in food costs to 4.55 percent, even though fruit prices accelerated by 35.81 percent, their quickest pace of increase in 10 years and seven months, Tsai said.

  Without the hike in fruit prices, the CPI would have risen only 0.14 percent, Tsai said.

  Prices for fishery products, vegetables and meat increased 4.38 percent, 1.83 percent and 1.12 percent respectively from their levels a year earlier, the report said. Processed food and dinning costs gained 1.43 percent, the report said.

  The absence of rainstorms or typhoons so far this summer helped stabilize food prices, Tsai said.

  Transportation and communications costs declined a 1.46 percent as distortions in crude oil prices tapered off, the report said.

  Housing and living prices dropped 0.75 percent last month because the fall in gas and utility prices more than muted the 5.37 percent rise in water charges, the report said.

  The core CPI, which is a more reliable indicator of long-term inflation because it excludes volatile items, increased 0.8 percent, smaller than its 0.91 percent rise in May, lending support to price stabilization, the report said.

  The wholesale price index (WPI) — a measure of production costs — fell 2.67 percent last month from a year earlier, stable from a 2.72 percent decline in May, the report said.

  Stripping foreign exchange volatility, export prices averaged 6.2 percent lower last month from a year earlier, posing continued challenge for export data to return to positive territory in June.

  The WPI dropped 3.19 percent last quarter, easing from 4.99 percent decline in the first quarter, and shrank 4.1 percent for the first six months, the report said.
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