Gov’t expects stable commodity prices over CNY

The China Post news staff

The government is closely monitoring commodity prices ahead of Chinese New Year (CNY) although prices of food and other items for the holiday period remain mostly stable.

The economics ministry said yesterday it has activated a system to monitor prices as well as supply and demand of commodities to make sure that people will have a “safe” Chinese New Year. Officials also revealed that the ministry will soon call a meeting to discuss issues concerning holiday consumer prices. The government has come extra pressure to stabilize prices after the local consumer price index (CPI) for December rose 2.03 percent on year, logging the biggest increase in 22 months. The United Evening News said the December CPI rose chiefly on sharp increases in vegetable prices. Vegetable prices are stabilizing now, the paper cited government officials as saying. But the officials admitted that commodity prices will naturally rise because of strong demand ahead of the holiday. The ministry in the past would collect necessary market data from suppliers when unusual price fluctuations occurred, the paper said.

To stabilize prices, the ministry would collaborate with major hypermarts to launch promotional sales, and if necessary it would have state-run businesses, such as Taiwan Sugar, act to stabilize food prices. Vendors’ associations have released figures showing that overall prices of holiday food items have increased four percent compared to last year — which is relatively stable, the United Evening News said. The figures were calculated taking into consideration of 15 most popular food items for Chinese New Year, such as garlic, mushroom, dried scallop and abalone. The service sector may not raise their prices at this moment. But some service segments are expected to charge more later. Many hairdressers will raise their prices in the final few days leading to Chinese New Year Day and will do so throughout the entire holiday period if they stay open.

Car washes are usually much more expensive than ordinary days during the holidays, while taxi fares are also expected to rise. Meanwhile, soaring international oil prices may force the local gasoline prices to rise more than NT$0.30 Monday, the United Evening News said. Gas prices have frozen for two weeks, and political observers said they are unlikely to go up with only less than week until Jan. 14 presidential and legislative elections.