The nation’s consumer price index (CPI) increased 2.03 percent year-on-year last month, mainly due to increases in food and fruit prices, as well as dining-out costs, the Directorate-General of Budget, Accounting and Statistics (DGBAS) said yesterday.
It was the second consecutive month that the nation’s CPI surpassed the central bank’s 2 percent target, but the inflationary gauge decelerated from the previous month’s 2.32 percent, the agency’s data showed.
Food prices rose 4.34 percent annually, with the costs of fruit growing 25.26 percent. Meat prices rose 4.46 percent, and those for cereal products such as bread and cakes grew 3.38 percent, the agency said in a report.
Photo: CNA
Dining-out costs grew 3.48 percent from a year earlier, above the 3 percent mark for more than six consecutive months and the highest increase over the past 13 months, the agency said.
As Taiwanese prefer eating out, this still-high spending renders a public perception that consumer prices are still rising, it added.
On a positive note, transportation and communications prices dropped 0.76 percent from a year earlier on the back of a 3.74 percent decrease in international energy prices and a 2.13 percent price fall in communication fees, while rents increased 2.4 percent year-on-year, the smallest increase in the past 12 months, the report said.
Still, inflation for households in the lowest 20 percent of income rose 2.26 percent last month, higher than the 2.09 percent for those with medium income and 1.88 percent for those with the highest 20 percent of income, DGBAS data showed.
Households with lower incomes felt the pinch of rising inflation as food costs comprise a larger share of spending, the agency said.
Core CPI, a more stable long-term price tracker that excludes price-volatile items such as vegetables and oil, last month increased 1.66 percent, below the 2 percent mark for 13 consecutive months, which the agency said was an indication that domestic prices remain stable.
In the first four months of this year, CPI grew 2.15 percent from the same period last year and cumulative core CPI rose 1.64 percent, the report said.
Meanwhile, the producer price index (PPI) last month rose 0.93 percent year-on-year, thanks to price increases in agricultural products, fuel and electronic components, the report said. In the first four months, the cumulative PPI grew 3.02 percent from the same period a year ago, it said.
The DGBAS said it sees no obvious risk of rising prices in Taiwan in the short term due to the US tariff policy and expects the recent surge in the New Taiwan dollar to affect import prices, but the effect on the CPI is expected to emerge in one to two quarters, the agency said.
It is possible that CPI growth would be below 2 percent this month in light of the recent fall in international crude oil prices, it added.
The US dollar was trading at NT$29.7 at 10am today on the Taipei Foreign Exchange, as the New Taiwan dollar gained NT$1.364 from the previous close last week. The NT dollar continued to rise today, after surging 3.07 percent on Friday. After opening at NT$30.91, the NT dollar gained more than NT$1 in just 15 minutes, briefly passing the NT$30 mark. Before the US Department of the Treasury's semi-annual currency report came out, expectations that the NT dollar would keep rising were already building. The NT dollar on Friday closed at NT$31.064, up by NT$0.953 — a 3.07 percent single-day gain. Today,
‘SHORT TERM’: The local currency would likely remain strong in the near term, driven by anticipated US trade pressure, capital inflows and expectations of a US Fed rate cut The US dollar is expected to fall below NT$30 in the near term, as traders anticipate increased pressure from Washington for Taiwan to allow the New Taiwan dollar to appreciate, Cathay United Bank (國泰世華銀行) chief economist Lin Chi-chao (林啟超) said. Following a sharp drop in the greenback against the NT dollar on Friday, Lin told the Central News Agency that the local currency is likely to remain strong in the short term, driven in part by market psychology surrounding anticipated US policy pressure. On Friday, the US dollar fell NT$0.953, or 3.07 percent, closing at NT$31.064 — its lowest level since Jan.
The New Taiwan dollar and Taiwanese stocks surged on signs that trade tensions between the world’s top two economies might start easing and as US tech earnings boosted the outlook of the nation’s semiconductor exports. The NT dollar strengthened as much as 3.8 percent versus the US dollar to 30.815, the biggest intraday gain since January 2011, closing at NT$31.064. The benchmark TAIEX jumped 2.73 percent to outperform the region’s equity gauges. Outlook for global trade improved after China said it is assessing possible trade talks with the US, providing a boost for the nation’s currency and shares. As the NT dollar
PRESSURE EXPECTED: The appreciation of the NT dollar reflected expectations that Washington would press Taiwan to boost its currency against the US dollar, dealers said Taiwan’s export-oriented semiconductor and auto part manufacturers are expecting their margins to be affected by large foreign exchange losses as the New Taiwan dollar continued to appreciate sharply against the US dollar yesterday. Among major semiconductor manufacturers, ASE Technology Holding Co (日月光), the world’s largest integrated circuit (IC) packaging and testing services provider, said that whenever the NT dollar rises NT$1 against the greenback, its gross margin is cut by about 1.5 percent. The NT dollar traded as strong as NT$29.59 per US dollar before trimming gains to close NT$0.919, or 2.96 percent, higher at NT$30.145 yesterday in Taipei trading