Taiwan's CPI growth tops 2% alert in December

Taipei, Jan. 7 (CNA) Taiwan's consumer price index (CPI) rose 2.10 percent from a year earlier in December, surpassing the Central Bank's 2 percent alert for the second consecutive month due to a spike in food prices, the Directorate General of Budget, Accounting and Statistics (DGBAS) said Tuesday.

Data compiled by the DGBAS showed the local CPI's year-on-year growth in December also beat an increase of 2.08 percent in November, indicating inflation is slow to moderate.

Core CPI, which excludes fruit, vegetables and energy, rose 1.65 percent from a year earlier after a 1.73 percent year-on-year rise in November, the DGBAS said.

On a month-on-month basis, the local CPI fell 0.02 percent but after seasonal adjustments, the index rose 0.15 percent, the DGBAS added.

For 2024, Taiwan's CPI grew 2.18 percent from a year earlier, the third straight year local inflation exceeded the 2 percent alert. However, inflation in 2024 still moderated from 2.95 percent in 2022 and 2.49 percent in 2023.

Speaking with reporters, DGBAS specialist Tsao Chih-hung (曹志弘) said food prices in December rose 4.05 percent, the largest spike among the seven major CPI categories in December, after heavy precipitation pushed up vegetable prices by 30.69 percent, the highest growth in 40 months.

The price of fruit, editable oil and fishery items grew 5.88 percent, 5.23 percent and 5.00 percent, respectively, in December, while dining out expenses also increased 3.03 percent, the DGBAS said.

The spike in food prices alone boosted CPI growth by 1.1 percentage points in December, Tsao said. However, the volatility in food prices will be a short-live phenomenon as vegetable prices showed signs of falling in early January as the impact of bad weather eased, he added.

In addition to food prices, Tsao said, service costs moved higher, in particular rent which rose 2.61 percent from the previous month, and while the growth moderated from 2.66 percent in November, it was the second largest hike in over 28 years. In December, living costs including rent rose 2.38 percent from a year earlier.

In December, 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, fell 0.25 percent from a year earlier after a 0.20 percent decline in November, the DGBAS said.

The DGBAS said the producer price index (PPI) rose 2.92 percent from a year earlier in December largely due to an increase in the price of agricultural products, electronic parts, chemical materials and drugs as well as higher electricity bills.

In 2024, the PPI grew 1.35 percent from 2023, the DGBAS said.

According to the DGBAS, inflation for households comprised of members aged 65 or older hit 2.37 percent in 2024, higher than the average of 2.18 percent as living costs, food prices and healthcare expenses had a greater weighting in that calculation model.

Tsao said a fall in prices in agricultural and industrial raw materials on global markets is expected to help consumer prices stabilize in the domestic market, adding it is possible the local CPI growth could fall below 2 percent in 2025.