Taiwan's inflation tops 2% in April, boosted by higher food prices

Taipei, May 7 (CNA) Taiwan's inflation surpassed 2 percent for the second consecutive month in April, with higher food prices the major factor driving the increase, the Directorate General of Budget, Accounting and Statistics (DGBAS) said Wednesday.

Data compiled by the DGBAS showed the country's consumer price index (CPI) rose 2.03 percent from a year earlier in April, after a 2.32 percent increase in March, staying above the 2 percent alert level set by the central bank.

On a month-to-month basis, the CPI rose 0.27 percent in April, and after seasonal adjustments also grew 0.05 percent.

In April, core CPI, which excludes fruit, vegetables and energy, rose 1.66 percent from a year earlier.

In the first four months of this year, Taiwan's CPI rose 2.15 percent from a year earlier, also topping the 2 percent alert level, while core CPI grew 1.64 percent, according to the DGBAS.

The DGBAS said food prices increased 4.34 percent from a year earlier in April, pushing up CPI growth in the month, with fruit prices soaring 25.26 percent on supply shortages, while the price of meat and bakery items grew 4.46 percent and 3.38 percent, respectively.

In addition, dining out costs also rose 3.48 percent from a year earlier, the highest growth since March 2024, when expenses rose 3.49 percent. The April rise also marked the sixth straight month growth has exceeded 3 percent.

Speaking with reporters, DGBAS specialist Tsao Chih-hung (曹志弘) said the continued increase in dining out costs is worth closely watching but the silver lining is the decision by Taiwan Power Co. to freeze electricity price hikes in April, which slowed down the upward pressure on dining out costs.

Food price hikes as a whole contributed 1.17 percentage points to April CPI growth, the DGBAS said.

In terms of living costs, which rose 1.89 percent in April, rent grew 2.40 percent but the increase slowed from 2.49 percent in March to the lowest since April 2024, when rents rose 2.35 percent.

In April, 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 0.87 percent from a year earlier, after a 0.75 percent increase in March, the DGBAS said.

Meanwhile, the producer price index (PPI) rose 0.93 percent from a year earlier in April largely due to a rise in the price of agricultural products, fuel, electronic components as well as an increase in electricity rates in October 2024, the DGBAS added.

The import price index fell 2.13 percent from a year earlier in April in Taiwan dollar terms and dropped 2.94 percent in U.S. dollar terms, while the export price index slid 0.15 percent in Taiwan dollar terms and 0.98 percent in U.S. dollar terms, the data showed.

In the first four months of the year, the PPI rose 3.02 percent from a year earlier, according to the DGBAS.

Tsao said due to the Trump administration's sweeping "reciprocal" tariffs imposed on April 2, despite a 90-day pause, concerns over global demand sent international raw material prices lower so the import price index moved lower from a year earlier for the 30th month in a row in April.

In the wake of falling international raw material prices, including crude oil prices, Tsao said, Taiwan is unlikely to see significant upward inflationary pressure.

Commenting on the recent rapid appreciation of the Taiwan dollar against the U.S. dollar, Tsao said importers are expected to see a weakening financial burden through growing purchasing power but that will be delayed for one to two quarters.

In February, the DGBAS forecast Taiwan's CPI will grow 1.94 percent in 2025.