Wed, Feb 13, 2019 - Page 12 News List

CPI edges up 0.2 percent as economy slows down

By Crystal Hsu  /  Staff reporter

The consumer price index (CPI) last month rose 0.2 percent from a year earlier as the global and domestic economy slowed, keeping consumer activity at bay, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday.

The latest reading reversed December last year’s decline, but was the second-smallest increase in 15 months, Senior Executive Officer Hsu Chien-chung (徐健中) said.

“The inflation gauge held largely steady last month as the decline in oil and communication prices offset the rise in food costs,” Hsu told a media briefing in Taipei.

Food prices, which comprise about 25 percent of the CPI weighting, posted a 0.85 percent increase, buoyed by egg, milk and fruit prices, Hsu said, adding that egg prices rose 20.75 percent annually.

However, a 17.79 percent decline in vegetable prices helped constrain the rise in food costs, thanks to a stable supply amid the absence of bad weather, he said.

Transportation and communication prices fell 1.58 percent, as crude oil prices dropped 4.33 percent, while MRT tickets, mobile and Internet charges fell 9.49 percent, 8.63 percent and 6.15 percent respectively, the agency said in a report.

The agency declined to comment on whether the flat CPI readings were related to an ongoing economic slowdown, saying that it would update GDP figures today.

The agency might trim its growth forecast for last year and this year, due to lower-than-expected export and import figures.

The core CPI, a more reliable long-term inflation tracker because it excludes volatile items, climbed 0.53 percent, indicating that there is no need to worry about deflation, the DGBAS said.

The CPI after seasonal adjustments slid 0.14 percent.

Travel and babysitting expenses might increase this month, since they usually do during the Lunar New Year holiday, it said.

The wholesale price index, a measure of production costs, last month rose 0.75 percent as firms turned conservative and adjusted inventory instead of expanding operations, the DGBAS said.

Export prices shrank 3.91 percent in US dollar terms, unfavorable for exports, it said.

The Ministry of Finance is due to release last month’s export data on Friday.

The ministry had earlier said that exports last month would likely decline 2.5 percent unless companies frontload shipments to avoid disruptions during the holiday.

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