South Korea’s July inflation rises 2.6% y/y, higher than forecast
SOUTH Korea’s consumer inflation ticked up in July after weakening for three straight months, official data showed on Friday, coming in slightly higher than market expectations.
The consumer price index in July rose 2.6 per cent from the same month a year earlier, after rising from an 11-month low of 2.4 per cent in June, while economists in a Reuters survey had expected a gain of 2.5 per cent.
The consumer price rise was in line with the finance minister’s comments last week that inflation might temporarily pick up due to abnormal weather conditions and base effects before stabilising from August.
Last month, the Bank of Korea opened the door for rate cuts after holding interest rates steady at a 15-year high of 3.50 per cent for the 12th straight meeting, but the board was divided over when to act.
The CPI rose 0.3 per cent on a monthly basis, after falling 0.2 per cent the previous month, according to Statistics Korea. That was the fastest rise in five months and a little higher than economists’ expectations for a median 0.25 per cent increase.
Prices of petroleum products climbed 3.3 per cent over the month, and agricultural products gained 0.9 per cent, as vegetable prices jumped 6.3 per cent.
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Annual core inflation, which excludes volatile food and energy items, was steady at 2.2 per cent for the third straight month. REUTERS
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