INSTANT VIEW-Taiwan Nov CPI above forecasts

TAIPEI, Dec 6 (Reuters) - Taiwan's consumer price index rose 1.53 percent in November from the previous year, above a median forecast in a Reuters poll due largely to higher food prices.

But a slower month on month rise is likely to keep the central bank on track to raise rates at its December meeting as it normalises after a long period of loose policy.

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KEY POINTS:

Nov CPI +1.53 pct yr/yr (Reuters poll median forecast +0.9 percent. Forecast range +0.4 percent to +1.5 percent)

S/adj CPI (m/m) +0.13 pct (poll median +0.15)

For a brief table, see

To see Taiwan's CPI in graphic form:

http://link.reuters.com/fum68q



COMMENTARY:

JOANNA TAN, ECONOMIST, FORECAST PTE

'The firmer headline is a product of a low base; on the month, pace actually slowed. Looking ahead, the inflationary picture still looks benign and should not force CBRC's hands to hike aggressively.

'The central bank is likely to keep to a gradual normalisation path to dampening overheating in asset prices and domestic liquidity while relying on other measures to douse property speculation.

'A modest 12.5 bps rate hike is pencilled in for the last monetary meet of the year.'



MARKET REACTION:

The data came out after the close of Taiwan's stock market. The main TAIEX share index closed up 0.91 percent. The Taiwan dollar's final price was T$30.625 to the U.S. dollar, up 0.4 percent on the day.



LINKS:

The website of the Directorate General of Budget, Accounting and Statistics is http://www.dgbas.gov.tw/mp.asp?mp=1

For all Taiwan news and data, 3000 Xtra users can click on or.



BACKGROUND:

-- Taiwan's government has forecast inflation of 0.98 percent

for the full year.

-- The central bank judges inflation to be benign, and raised rates to 1.5 percent in September. Economists expect another 12.5 basis point hike at the next quarterly policy meeting due on Dec 30, with the CPI figures unlikely to alter this view.

-- Wages growth in Taiwan is slow, keeping a lid on inflation.

-- Other Asian economies are facing much higher inflation, with South Korea's at 3.3 percent in November and China's at a 25-month high 4.4 percent. A similarly high figure is forecast for China's November CPI, due on Dec 13.



(Reporting by Karen Lema and the Taipei bureau; Editing by Jonathan Standing)

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