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COST OF LIVING/CPI growth hits 2.90% in November boosted by higher food prices

12/06/2023 09:46 PM
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A shopper browses through vegetables in a supermarket in Taipei Wednesday. CNA photo Dec. 6, 2023
A shopper browses through vegetables in a supermarket in Taipei Wednesday. CNA photo Dec. 6, 2023

Taipei, Dec. 6 (CNA) The consumer price index (CPI) grew 2.90 percent from a year earlier in November largely on the back of higher food prices, the Directorate General of Budget, Accounting and Statistics (DGBAS) said Wednesday.

Data compiled by the DGBAS showed that CPI growth remained above the 2 percent alert set by the central bank in November but moderated from a 3.05 percent year-on-year increase in October.

Core CPI, which excludes fruit, vegetables and energy, rose 2.38 percent from a year earlier, with growth dipping to the lowest level since February 2022, when the core index stood at 1.64 percent, the data indicated.

On a month-on-month basis, the November CPI fell 0.28 percent, and after seasonal adjustments, also dropped 0.07 percent, the DGBAS said.

In the first 11 months of this year, Taiwan's CPI grew 2.48 percent from a year earlier with core CPI up 2.60 percent year-on-year, the DGBAS added.

Higher food prices served as the main reason for CPI growth in November, soaring 5.63 percent from a year earlier, the DGBAS said.

Shortage of fruit, vegetables

Speaking with reporters, Tsao Chih-hung (曹志弘), a DGBAS specialist, said a shortage of fruit and vegetables, caused by extended effects from bad weather in the most recent typhoon season, caused the food price hikes.

In November, the price of fruit and vegetables rose 18.73 percent and 10.67 percent, respectively, while the price of meat, frozen food, eggs and grains increased 6.15 percent, 4.75 percent, 4.48 percent and 3.17 percent, respectively. In addition, the cost of dining out stayed high, rising 4.21 percent from a year earlier in November.

Tsao said the price growth of fruit and vegetables contributed about 0.64 percentage points to the November CPI rise.

Solid demand for entertainment

n the post COVID-19 era, demand for entertainment activities remains solid, pushing up the cost by 4.40 percent from a year earlier in November, another driver to the high CPI, but less than the 6.01 percent hike in October.

The increased cost of entertainment is expected to continue to slow for the rest of the fourth quarter on the back of a relatively high comparison base over the same period of last year, Tsao said.

The cost of a basket of 17 government-monitored household necessities, including rice, pork, bread, eggs, sugar, cooking oil, instant noodles, shampoo and toilet paper, rose by 3.46 percent from a year earlier in November, after a 3.47 percent increase in October, marking the fourth consecutive monthly increase, the DGBAS said.

Producer price index

Meanwhile, the producer price index (PPI) for November fell 0.70 percent from a year earlier as CPC Corp., Taiwan, the state-owned oil supplier in the country, cut natural gas prices, while the price of crude oil, coal products, base metals, chemical raw materials and drugs also moved lower, the DGBAS said.

However, the decline in the PPI was partially offset by increases in electricity tariffs, more expensive agricultural products and electric equipment, the DGBAS added.

The import price index fell 4.39 percent from a year earlier in November in Taiwan dollar terms and also dropped 5.79 percent in U.S. dollar terms, while the export price index fell 1.96 percent in Taiwan dollar terms and shed 3.40 percent in U.S. dollar terms, the data showed.

In the first 11 months of this year, the local PPI fell 0.56 percent from a year earlier, according to the DGBAS.

Outlook

High inflation and an aggressive rate hike cycle by major central banks around the world weakened global demand and sent international crude oil prices lower, which has helped local enterprises cut costs and lower the pressure from imported inflation in Taiwan, Tsao said.

CPI growth is expected to continue to moderate from quarter to quarter next year to below 2 percent in 2024, he added.

In November, the DGBAS forecast Taiwan's CPI will grow 2.46 percent in 2023 and moderate to 1.64 percent in 2024.

(By Pan Tzu-yu and Frances Huang)

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