Taiwan: Consumer prices in annual terms fall to lowest level in more than 3 years
September 5, 2013
Consumer prices rose 0.12% over the previous month in August, which contrasted the 0.16% drop observed in July. The monthly increase mainly reflects higher prices for food due to seasonal factors, according to the Directorate General of Budget, Accounting and Statistics (DGBAS).
Consumer prices fell 0.8% in August over the same month last year, which contrasted the 0.1% increase observed in July; the drop was larger than the 0.3% fall expected by the market. August's drop marks the first negative year-on-year change in more than three years. Annual average inflation declined from 1.6% in July to 1.3% in August.
The core inflation index - which excludes volatile categories such as fresh food and energy - dropped 0.23% over the previous month (July: 0.0% month-on-month), keeping annual core inflation at 0.5% in August (July: 0.5% year-on-year).
FocusEconomics Consensus Forecast panelists expect inflation to average 1.6% in 2013, which is down 0.1 percentage points from last month's forecast. Next year, the panel sees inflation inching up to 1.8%.
Author: Ricardo Aceves, Senior Economist