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South Korea’s annual inflation rate slowed to 2.8% in October from 2.9% in September, data released Tuesday showed, as falling agricultural prices offset part of the pressure from more expensive fuel.
The Ministry of Finance and Economy said the consumer price index reached 120.73, with 2020 as the base of 100. Prices rose 0.2% from September. Slower annual inflation means prices are rising less quickly, not that the overall price level is falling.
Fuel and food move in opposite directions
Petroleum products cost 14.9% more than a year earlier and contributed 0.56 percentage point to annual inflation, Yonhap reported, citing the Ministry of Data and Statistics. Diesel rose 19.7% and gasoline 11.6%.
Prices of agricultural, livestock and fishery products fell 1.7%, their third consecutive annual decline. Apples fell 13.4% and napa cabbages 44.3%, while domestically produced beef rose 9.1%. Those differences show why the headline rate can ease even while some common purchases become more expensive.
Services prices rose 2.7%. Dining-out prices increased 2.9%, while core inflation, excluding food and energy, was 2.8%.
Central bank sees inflation staying elevated
The Bank of Korea expects November inflation to remain in the high 2% range as oil prices and underlying price pressures persist, according to Yonhap reporting carried by The Korea Herald. Deputy Governor Lee Ji-ho said agricultural supply had helped October’s improvement, while private services and durable goods remained expensive.
That November assessment is a central-bank forecast, not another completed month’s reading. Tuesday’s data alone do not announce a change in interest rates.
JBizNews Desk | Seoul
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