The consumer price index (CPI) last month rose 0.94 percent from a year earlier, the highest in seven months, backed mainly by higher food costs after heavy rainfall disrupted vegetable supplies and pushed up prices, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday.
The inflation figure for last month was higher than the 0.66 percent increase in April and a 0.8 percent growth forecast by DBS Bank Ltd (星展銀行).
Food costs, which account for 25 percent of the inflation gauge, gained 2.58 percent from a year earlier as heavy rainfall on May 17 took a toll on agricultural crops, driving up vegetable prices by 26.24 percent, DGBAS Senior Executive Officer Hsu Chien-chung (徐健中) said.
The plum rain season, which generally occurs in May and June, is especially evident this year and disrupted vegetable supplies, the agency said.
The rainy season is named after its coincidence with the ripening of plums in southern China.
A drastic fall in egg prices helped ease food costs, Hsu said.
Entertainment and education costs picked up 1.02 percent as travel agencies increased group tour charges to reflect foreign exchange movements, as well as hikes in prices for accommodation and admission tickets to recreational facilities, the agency said in a report.
Living costs climbed a mild 0.9 percent following an 8.75 percent increase in gas prices, the report said, adding that medical and health prices edged up 0.93 percent after hospitals raised registration fees.
The CPI after seasonal adjustments registered a fractional 0.06 percent pickup, suggesting benign inflation, Hsu said.
Garment prices dropped 1.06 percent, as companies offered discounts to facilitate sales of summer clothing, the report said.
The core CPI — a more reliable long-term consumer price tracker, as it excludes volatile items — advanced 0.62 percent, the highest in six months, Hsu said.
DBS said that Taiwan’s overall inflation picture remains benign, with the headline and core CPI figures running below the long-term average of 1 percent.
Meanwhile, the wholesale price index (WPI), a measure of production costs, declined 0.23 percent, the first drop in 14 months, as a trade dispute between the US and China weighed on raw material prices, the agency said.
Export prices in US dollar terms saw a 5.28 percent retreat from a year earlier, as selling prices for plastic, chemical, electrical and other products all took a hit, the report said.
For the first five months of this year, the CPI grew 0.51 percent, while the WPI gained 0.5 percent, it said.
Mild inflation would give the central bank room to extend its accommodative monetary policy at a board meeting on June 20 to help support economic growth, it added.
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