The consumer price index (CPI) last month climbed 2.48 percent from a year earlier, the second consecutive month in which it rose above the 2 percent alert level, as inflationary pressures build up and threaten corporate profits, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday.
The latest inflationary reading is the highest since March 2013, but might ease somewhat next month, as the low base effect disappears, the agency said, adding that consumer activity in May last year was weak due to the COVID-19 pandemic.
“Inflation risks remain benign” based on core CPI, a more reliable long-term price gauge, because it excludes volatile items such as vegetable and fuel prices, DGBAS official Tsao Chih-hung (曹志弘) said.
Photo: CNA
The core CPI edged up 1.58 percent, lending support to stable consumer prices, Tsao said, adding that the inflationary barometer after seasonal adjustments rose 0.27 percent.
Of major consumption categories, transportation and communications prices posted the biggest increase at 9.5 percent, driven by a 43.92 percent spike in fuel prices and a 34.6 percent jump in airfares, the DGBAS said.
A 9.65 percent decline in the prices of telecommunication devices helped mitigate the increase, the agency said in its monthly report.
Clothing prices gained 2.65 percent, as garment retailers have been unwilling to offer discounts this year, it said.
Similarly, educational and entertainment costs grew 1.7 percent as a previous boom in domestic tourism led travel agencies and hotel operators to hike prices, it said.
Food costs, which account for about 25 percent of the CPI weighting, increased 1.69 percent, as vegetable and fruit prices picked up 7.49 percent and 4.6 percent respectively due to meager supplies, it said.
The wholesale price index (WPI), a measure of commercial production costs, jumped 11.33 percent from a year earlier, the steepest gain since August 2008, as fast-rising raw material costs and freight rates threatened to erode corporate profits, Tsao said.
“The threat would grow more evident and heavy if the uptrend persists,” he said.
For the first five months of this year, consumer prices increased 1.39 percent, while the WPI advanced 4.79 percent, the agency said.
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