Taiwan inflation rises 2.75% in September compared with previous month

TAIPEI: Taiwan's inflation went up in September, with the consumer price index CPI rising 2.75 per cent from a year earlier, which is roughly in line with economists' predictions, but also below 3 per cent for the second month in a row.

The pace was quickened from a 2.66 per cent year-on- year reading for August, the Directorate General of Budget, Accounting and Statistics said on Thursday that the CPI was expected to increase by 2.7 per cent from a year earlier.

The Core CPI, a measure of underlying price pressures, went up an on-year 2.79 per cent last month, compared to 2.73 per cent in August. It excludes more volatile energy, vegetable and fruit prices.

Tsao Chih-hung, a directorate official, told reporters that October's inflation rate should be a little lower than September's, and that they still believed inflation had peaked in the second quarter.

As the year progresses, inflation will likely continue to abate, Tsao said.

The inflation rate had hit a new 14 year high of 3.59 per cent in June.

Like its peers, Taiwan's central bank is keeping a watch on price rises as it considers monetary policy.

The bank raised its benchmark policy rate for the third time this year, but only by a mild 12.5 basis points bps to 1.625 per cent last month.

The central bank said that the CPI would rise 2.95 per cent in 2022, slightly revising up the outlook from 2.83 per cent predicted in June.

Inflation in Taiwan has never been as bad as in the United States or Europe.

The central bank's governor, who said last month it will need to keep inflation forecasts in mind when it comes to the direction of monetary policy, holds its next quarterly rate-setting meeting in mid-December.