The consumer price index (CPI) last month increased 1.89 percent, decelerating from a 2.48 percent increase one month earlier, as a low base tapered off and affirming that inflation risks were temporary in nature, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday.
“Consumer prices for this year likely have plateaued based on the latest data, and there is no need to worry about uncontrollable inflation,” DGBAS official Tsao Chih-hung (曹志弘) said, attributing earlier increases above 2 percent to a low comparison base in the second quarter of last year due to the COVID-19 pandemic.
The government’s decision to suspend the summer increase in the electricity rate also helped take the pressure off inflation, Tsao said.
Photo: CNA
The policy, intended to ease financial burden on the public amid a nationwide level 3 COVID-19 alert due to a domestic outbreak, accounted for an 18.35 percent decline in the cost of electricity, substantially mitigating pain linked to increases in rent and home improvement costs, he said.
It explained why living and housing costs increased by just 0.12 percent, he added.
Transportation costs posted the biggest advance of 7.62 percent, propelled by a 32.52 percent spike in airfares and a 27.78 percent gain in fuel prices, the agency’s monthly report showed.
In the absence of steep imported inflation — caused by an increase in the cost of oil-based products — consumer prices would continue to trend down, Tsao said.
A recovery in the global economy would lend support to oil consumption and fuel prices, although discord among oil exporting nations had helped keep price rises at bay, he said.
Clothing prices increased 2.37 percent, as garment suppliers shied away from generous discounts to stimulate sales, while food costs rose 2.18 percent, as high temperatures weighed on supplies of fruit and vegetables, driving up the cost, Tsao said.
Education and entertainment costs posted a 1.07 percent increase, as facility operators canceled promotions this year with people avoiding going out, the report said.
Core CPI, a more reliable long-term price tracker that excludes volatile items, posted a 1.36 percent gain, confirming stable prices, the agency said.
The wholesale price index (WPI), a gauge of commercial production costs, rose 10.74 percent, down from a revised 11.63 percent increase in May, it said.
The growth would likely slow if international fuel and raw material prices stabilize, Tsao said.
In the first six months of the year, the CPI rose 1.47 percent, while the WPI gained 5.84 percent, the agency said.
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