Taiwan's June CPI is likely to rise near 2.00% on year as the government's planned power rate hikes will take effective from June 10, says Taishin Securities Investment Advisory economist Kevin Wang. May CPI rose 1.74% on year, higher than April's rise of 1.44% and a 1.45% increase tipped in a Dow Jones poll. The government attributes the higher CPI in May to rising prices of vegetables, eggs and fruits, as prices last year were much lower due to good harvests. "The impact of the power price hikes will become much greater in the next couple of months...the CPI in the second half of this year is still likely to rise above 2.00% from a year earlier," he says, noting that a lower base of comparison in 2H11 due to falling food prices amid mild weather is also likely to drive CPI higher.
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