Taiwan: Inflation remains low and stable in February

Consumer prices jumped 0.99% in February from the previous month, contrasting the 0.09% decline registered in January. The print was largely led by seasonal effects of the Lunar New Year holiday. Notably, the price of nursing care and nursery services increased by nearly a third in the month, as is customary, while the prices of vegetables and entertainment also increased sharply due to holiday demand.

Inflation was meanwhile stable at January’s 0.2% in February, and annual average inflation ticked down to 1.1%, from 1.3% in January.

Core consumer prices, which exclude prices for energy, fruits and vegetables increased 0.89% month-on-month in February, contrasting January’s 0.08% fall. Lastly, core inflation fell from 0.5% in January to 0.3% in February.

Taiwan Inflation Forecast

The government expects inflation to average 0.7% in 2019. FocusEconomics panelists expect inflation to average 1.1% in 2019, which is down 0.1 percentage points from last month’s forecast, and 1.2% in 2020.