CPI rises 0.83% over last year in September

By John Liu, The China Post

TAIPEI, Taiwan — The consumer price index (CPI) registered at 104.05 in September, up 0.83 percent from the same period last year, according to a report released by the Directorate-General of Budget, Accounting and Statistics (DGBAS). Although a 0.83-percent increase might seem marginal, the public did feel the pinch of the price increase in September. The tropical storms that have hit Taiwan in the last couple of months drove consumer prices up in September, especially for fruits and vegetables. Vegetables prices increased 27.93 percent compared with a year ago. Meat prices also went up 4.75 percent, of which chicken prices went up 10.87 percent. Since the implementation of electric slaughtering, chicken prices between January and September have increased significantly, the DGBAS said, adding that this is only a short-term phenomenon and probably would not occur again next year. In addition to Tropical Storm Usagi that struck Taiwan in September, Tropical Storms Trami and Kong-Rey brought huge rainfalls in late August, resulting in higher vegetable and fruit prices in September. Mid-Autumn Festival also drove up food demand. Vegetable and fruit prices increased 39.29 percent and 8.33 percent month-on-month, respectively. Price Increases Felt by the Public While the effects of increases in food prices were obvious to the general public, price decreases in other merchandise such as 3C products (computer, communication and consumer electronics) and jewelry and precious metals did not have too much of an impact. The DGBAS pointed out that lower-income households experienced a higher CPI increase than mid- and higher-income households, as food constitutes a higher proportion of lower-income families’ purchases.

In addition to food prices, gas prices also increased. With an electricity price hike set to be implemented in October, many merchants have in turn hiked prices for products and services. All of these factors have contributed to higher daily expenses, despite the relatively low inflation figure released by the government. Food prices went up 2.36 percent year-on-year, medical and health insurance costs increased 1.17 percent, education and leisure rose 0.73 percent, and housing related expenses climbed 0.51 percent. In addition, milk powder went up 3.77 percent year-on-year, Chinese restaurant dining rose 1.54 percent, Chinese pastry grew by 1.36 percent, and coffee and beverage fees climbed by 1.33 percent. Consumers who dine out often may have already felt the pinch of price increases. Prices Drop for Less-purchased Items Among those products and service that saw significant price drops in September, gold and jewelry fell 16.22 percent month-on-month, transportation related expenses — including car rental, license fees and towing fees — dropped 13.22 percent, car inspection fees decreased by 12.58 percent, mobile phones dipped 11.32 percent, digital camera and video dropped 10.59 percent, and TVs saw a 6.85-percent decline. Analysts said that among the 370 product categories that contribute to the CPI, products and services that saw relatively larger price drops were “big-ticket” items or durable goods which were purchased less often. Mobile phone plan promotions as well as reductions in Internet usage fees and oil prices have resulted in lower communication and transportation expenses, partially offsetting price increases.